“Hallucinatory” citations and errors in an AI-assisted report produced by Deloitte for the Australian government should be a wake-up call for compliance officers about the risks of placing too much trust in AI. It should also reassure those who fear that AI could replace many compliance jobs. The message is clear that human oversight and regular reality checks are still vital.

Ruth Prickett graduated from Cambridge University with a BA hons in History and has specialized in business and finance journalism for the past 20 years. She was editor of Financial Management, the magazine...