Australian government settles Robodebt class action for $1.7 billion
The Robodebt system, an automated debt recovery system used by Centrelink, calculated welfare debts using averaged income data from the ATO, leading to invalid debts. A class action was filed in November 2019 and settled in November 2020. The settlement provided refunds of over $751 million in invalid debts collected and $112 million in compensation to approximately 400,000 group members. The Australian government also dropped claims for over $1 billion in invalid debts.
- Company involved
- Australian Government (Centrelink)
- AI system involved
- Robodebt
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CFPB fines General Information Services for inaccurate background checks
The Consumer Financial Protection Bureau took action against General Information Services and its affiliate e-Background-checks.com for failing to ensure the accuracy of employment background screening reports. The companies allegedly provided inaccurate criminal history information to employers, potentially affecting job applicants' eligibility and causing reputational harm. The CFPB ordered the companies to provide $10.5 million in relief to harmed consumers and pay a $2.5 million penalty.
- Company involved
- General Information Services
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FinTech and traditional lenders discriminate against minority borrowers in mortgage pricing
A study of mortgage lending from 2012-2018 found that Latinx and African-American borrowers were charged higher interest rates than white borrowers with similar credit risk. FinTech algorithms reduced the disparity by 40% but did not eliminate it. The discrimination costs minority borrowers an estimated $765 million per year in extra interest.
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Wells Fargo software error caused hundreds of faulty foreclosures
Wells Fargo disclosed that a software error in its mortgage modification underwriting tool caused incorrect denials of loan modifications for approximately 870 borrowers between 2010 and 2015. The error miscalculated attorneys' fees, leading to 545 foreclosures that should not have occurred. Wells Fargo set aside $8 million for remediation and is contacting affected customers to offer compensation and mediation.
- Company involved
- Wells Fargo
3 source articles · read the reporting →
Air Canada Chatbot Fabricates Discount, Leading to Court Case
Air Canada's customer service chatbot allegedly fabricated a discount during a conversation with a customer last year. The incident resulted in a court case against the airline. Insurer Armilla stated that its new AI mishap policy would have covered the loss from selling tickets at the discounted price if the chatbot was found to have underperformed.
- Company involved
- Air Canada
- AI system involved
- chatbot
6 source articles · read the reporting →
Douglas v. Deutsche Bank National Trust Company (D.C. Court of Appeals): AI-hallucinated content in court filing, Brief Stricken; Bar Referral
The AI generated fake legal citations that were included in an appellate brief, misleading the court and the opposing party.
- AI system involved
- Google AI
1 source article · read the reporting →
Guo Bing sues Hangzhou safari park over mandatory face-scans
Guo Bing, a legal academic, filed a lawsuit against a local safari park in Hangzhou after the park informed season-pass holders that admission would require a face-scan. He claimed the requirement violated his privacy. The lawsuit is the first of its kind in China and has generated significant public attention.
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Banjo's Live Time system overstated capabilities and posed privacy risks for Utah public safety data
The Utah State Auditor reviewed the contract for Banjo's Live Time public safety application. The system was found to lack advertised AI technology and posed security risks due to direct database queries to PSAP databases. Banjo also overstated its capabilities in its response to the RFP. The auditor concluded that personally identifiable information was unlikely accessed but recommended more rigorous vetting and better security practices.
- Company involved
- Utah Attorney General's Office
- AI system involved
- Live Time
5 source articles · read the reporting →
SEC warns public of deep fake investment scams featuring Lance Gokongwei
The Securities and Exchange Commission (SEC) warned the public that scammers are using deep fake videos and audio of Lance Gokongwei to endorse fraudulent investment schemes. The manipulated media circulate on social media, deceiving people into investing in a platform registered in Cyprus. Victims are asked to provide credit card details and OTPs, then lose contact when attempting to withdraw funds. The SEC advises the public to verify investment offers with the agency.
2 source articles · read the reporting →
Barclays pilot of Sapience monitoring software causes employee stress
Barclays introduced a pilot of employee monitoring software from Sapience in its product control department at Canary Wharf. The system monitors computer activity and admonishes staff if they are not deemed active enough, recording breaks as "unaccounted activity". Employees reported significant stress and worry about taking breaks. Barclays acknowledged the pilot and said it would listen to feedback.
- Company involved
- Barclays
- AI system involved
- Sapience employee monitoring software
10 source articles · read the reporting →
Macy's sued for using Clearview AI facial recognition without consent
A Chicago woman, Isela Carmean, filed a class-action lawsuit against Macy's, alleging the department store used Clearview AI facial recognition technology to identify customers without their consent, violating Illinois' Biometric Information Privacy Act. The lawsuit claims Macy's sent customer images from store surveillance to Clearview's database to obtain personal information. Macy's declined to comment on the pending litigation.
- Company involved
- Macy's
- AI system involved
- Clearview AI
10 source articles · read the reporting →
Google AI Overviews provide inaccurate finance information in 43% of searches
A study by The College Investor found that Google's AI Overviews provided misleading or inaccurate information in 43% of 100 personal finance-related searches. The AI-generated answers included outdated tax rules and incorrect student loan repayment plan details. One user believed she could convert her 529 plan to a Roth IRA in California, which is not allowed. Google has not responded to requests for comment.
- Company involved
- Google
- AI system involved
- AI Overviews
3 source articles · read the reporting →
DeepScore markets facial and voice analysis app for trustworthiness scoring despite experts' doubts
DeepScore, a Tokyo-based company, is marketing an app that uses facial and voice recognition to score people's trustworthiness for lenders and insurers in Japan, Indonesia, Vietnam and the Philippines. The company says the app can detect deception with 70 per cent accuracy, but researchers and privacy advocates say there is no reliable scientific basis for such judgments and warn of discrimination and privacy harms. The chief executive said the system is only one part of lenders' and insurers' decision-making and that people can choose not to use it. Critics respond that an unequal balance of power makes consent difficult.
- Company involved
- DeepScore
- AI system involved
- DeepScore
6 source articles · read the reporting →
CBSE introduces facial recognition system for students to access digital documents
The Central Board of Secondary Education (CBSE) has introduced a facial recognition system for Class 10 and 12 students to access their digital academic documents. A live image of the student is compared with the photograph on their CBSE admit card and, if the match succeeds, the certificate is emailed to them. The facility is available on Digi Locker for 2020 records and is expected to help foreign students and those unable to open a Digi Locker account.
- Company involved
- Central Board of Secondary Education (CBSE)
- AI system involved
- Facial Recognition System
10 source articles · read the reporting →
Facebook Allowed Age-Targeted Credit Card Ads Violating Its Policy
The Markup found that four companies—Aspiration, Hometap, Chime, and Varo Bank—ran Facebook ads for credit cards and home equity loans that were targeted by age, excluding users under 25 or 35. This practice violates Facebook's own anti-discrimination policy and may violate the Equal Credit Opportunity Act and California's Unruh Civil Rights Act. Facebook did not respond to requests for comment, and some advertisers said they would review their ad targeting.
- Company involved
- Facebook
- AI system involved
- Facebook Ad Platform
9 source articles · read the reporting →
PwC develops facial recognition tool to monitor employees working from home
Accounting giant PwC has developed a facial recognition tool that logs when employees are absent from their computer screens while working from home. The tool, intended for financial institutions, requires workers to provide written reasons for any absences, including toilet breaks. Commentators have criticised the tool as a huge invasion of privacy, with concerns about damage to trust and increased stress. PwC stated that the technology is designed to help regulated institutions meet compliance obligations and that voluntary consent of traders is essential.
- Company involved
- PwC
8 source articles · read the reporting →
Study finds credit score algorithms less accurate for minorities
A study of 50 million US consumers found that credit scoring algorithms used by mortgage lenders are less accurate for minority and low-income applicants due to sparse credit data, leading to higher rejection rates. The inaccuracy is due to noise in the data, not bias, so fairer algorithms cannot fix it. The study suggests that adjusting for bias had no effect, and that addressing the inaccuracy could reduce disparities by 50%.
- Company involved
- Mortgage lenders (unnamed)
- AI system involved
- Credit scoring algorithms
6 source articles · read the reporting →
LoanDepot algorithm denied mortgage to Black couple in Charlotte
In August 2019, Crystal Marie and Eskias McDaniels, a Black couple, were denied a mortgage for a house in Charlotte, North Carolina, by loanDepot's automated underwriting algorithm. The algorithm rejected the application because Crystal Marie was a contractor, not a full-time employee, despite her high credit score and income. After the couple enlisted their real estate agent and employer to intervene, the lender reversed the decision and cleared them to close. The couple alleged that race played a role in the denial, which loanDepot denied.
- Company involved
- loanDepot
- AI system involved
- Classic FICO and Fannie Mae/Freddie Mac automated underwriting software
10 source articles · read the reporting →
Spanish Supreme Court orders release of BOSCO algorithm code for social electricity bonus
The Spanish NGO Civio won a Supreme Court case forcing the government to release the source code of BOSCO, the algorithm that decides eligibility for the social electricity bonus (bono social eléctrico). Civio had demonstrated in 2019 that BOSCO contained serious errors that denied the benefit to vulnerable people who met the requirements. The government had refused to disclose the code, citing intellectual property. The Supreme Court ruled that transparency must prevail, setting a precedent for public access to automated decision-making systems.
- Company involved
- Ministerio para la Transición Ecológica (Gobierno de España)
- AI system involved
- BOSCO
10 source articles · read the reporting →
Zhengzhou officials punished for red health codes on depositors
Five officials in Zhengzhou were punished for ordering red health codes to be assigned to 1,317 depositors of four village banks, restricting their movement and preventing them from withdrawing savings. The officials acted without authorization, and the codes were later turned green after media coverage. Legal experts say the liability for privacy invasion remains unresolved, and the banks may face breach of contract claims.
- Company involved
- Zhengzhou municipal government
- AI system involved
- Health code system
10 source articles · read the reporting →
ООО «Точка опоры» v. ООО «ЦСС» (West Siberian District AC): AI-hallucinated content in court filing, Monetary Fine
The AI system generated fake legal citations that were submitted to the court, resulting in a fine for contempt.
- Company involved
- ООО «ЦСС»
1 source article · read the reporting →
CJEU rules Dun & Bradstreet must explain automated credit decisions under GDPR
A customer was refused a mobile phone contract because of an automated credit assessment by Dun & Bradstreet Austria. The customer took the case to court, which found that Dun & Bradstreet had infringed the GDPR by failing to provide meaningful information about the logic involved. The CJEU ruled that data controllers must explain automated decisions and that trade secrets cannot automatically override the right of access.
- Company involved
- Dun & Bradstreet Austria GmbH
7 source articles · read the reporting →
Bots and short sellers spread misinformation to trigger First Republic Bank run
A report by Valent Technologies alleges that AI-powered bots and fake accounts spread misinformation about First Republic Bank in March 2023, coinciding with a $100 billion deposit withdrawal and the bank's collapse. The report suggests short sellers likely orchestrated the bots to drive down the share price. Federal regulators closed the bank and sold its assets to J.P. Morgan, and the bank's former CEO attributed the collapse to 'contamination' by anxiety.
2 source articles · read the reporting →
TransUnion AI tenant screening denied 75-year-old man apartment due to mistaken littering conviction
Chris Robinson, then 75, applied for a senior living apartment in California. The property manager used an AI screening program from TransUnion, which assigned him a low score based on a mistaken conviction for littering that belonged to a different person with the same name in Texas. Robinson lost the apartment and his application fee. A federal class-action lawsuit against TransUnion moved toward a $11.5 million settlement in 2023.
10 source articles · read the reporting →
