Skip to content
Back to Blog
Industry

An AI Customer Service Chatbot Made Up a Company Policy - and Created a Mess

September 2025
An AI Customer Service Chatbot Made Up a Company Policy - AI Hallucination in Customer Service

In the rapidly evolving landscape of AI-driven customer service, ensuring that chatbots operate within well-defined parameters is crucial. A recent incident involving Cursor, an AI-powered code editor, underscores this point.

A user encountered unexpected session terminations when switching devices and reached out to support. The AI chatbot, "Sam," responded by citing a new policy restricting usage to one device per subscription-a policy that didn't exist. This fabricated response led to user frustration and subscription cancellations.

This episode on Wired highlights the importance of controlling the context provided to AI systems to prevent such "hallucinations" and maintain customer trust.