What is AI washing?
AI washing is marketing or disclosure that overstates, misrepresents or fabricates the role of artificial intelligence in a product: “AI-powered” features that are rules engines or human labour behind the curtain, invented model capabilities, or inflated automation claims. It is not an AI Act concept. The exposure runs through general law: securities and investor-fraud rules — the SEC has brought AI-washing enforcement actions since 2024 — consumer-protection and unfair-competition rules, and advertising self-regulation.
Where it bites hardest
- Fundraising: pitch decks and information-rights materials sit squarely in fraud-rule territory — an AI claim is the cheapest to make and the most expensive to defend;
- M&A and investment documents: “AI capabilities” representations and warranties are now standard; an inflated claim becomes an indemnity event at exit;
- Product marketing: “AI” claims must be substantiated like any other performance claim — before publication, not after the complaint.
The legal dimension
The pattern across all three arenas is the same: the statement is judged when made, against the evidence held at the time. The working fix is an evidence file — for every public AI claim, a one-page substantiation memo recording what the model actually does, the metrics behind the claim and the human role in the loop. Due diligence teams now ask for exactly this file, and its absence is itself a finding.
Turkish context
Türkiye has no AI-specific statute, so AI washing lands under general rules: consumer-protection law (TKHK) and the advertising framework for claims aimed at consumers, the unfair-competition provisions of the Commercial Code (TTK) between businesses, and capital-markets disclosure rules where investors are involved. KVKK (Law No. 6698) is a separate trap: describing human-run processing as “fully automated AI” misstates the processing itself. For Turkish startups raising from foreign funds, the deck is read under the investor’s fraud rules, not only Turkish law.
Do: keep a substantiation memo behind every public AI claim and re-read the deck before each round. Don’t: let marketing describe as “AI” what engineering calls a rules engine; the gap between the two documents is the claimant’s exhibit.
Related guides: AI Due Diligence.
Sources. Regulation (EU) 2024/1689 (AI Act).