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June 12, 2025
Cadwalader partner Tom Grodecki was quoted in a recent Compliance Week article exploring the growing regulatory and reputational risks surrounding “AI washing”—a deceptive practice in which companies exaggerate or misrepresent their use of artificial intelligence technologies.
Tom warned that the trend is unlikely to slow down anytime soon. “Fierce investor appetite and sky-high valuations have pushed companies to overstate their AI capabilities,” he said. “With AI fever still high and scrutiny limited, the risk of AI-washing shows no sign of abating.”
The article discusses how companies may be mislabeling traditional automation tools as AI, prompting concern from regulators in the U.S. and Europe. It also highlights deceptive marketing’s potential to trigger investigations or enforcement of compliance obligations under laws such as the EU AI Act.
Read the full article here (subscription required).