KPMG Withdraws AI Report Amid Hallucination Allegations

Professional services firm KPMG has pulled a report titled, 'Redefining excellence in the age of agentic AI,' after numerous organizations said the report's claims about their AI usage were untrue. Research group GPTZero identified a number of inaccuracies in the report, which was published in October 2025. GPTZero told the FT that the inaccuracies stemmed from AI hallucinations.

In other words, the professional services firm appears to have used AI to help write a report about AI. UBS, the UK's National Health Service, Swiss Federal Railways, and Transport for London all told the FT that the report's claims about their AI usage were either untrue or misleading. A KPMG spokesperson said the firm removed the report from its websites while conducting its own investigation.

'We expect all our people to follow our guidelines on the responsible use of AI, including human oversight to validate content and verify independent sources,' the spokesperson said. Last month, EY withdrew a report on loyalty rewards programs that appeared to include fake footnotes and AI hallucinations. The incident raises concerns about the reliability of AI-generated content in professional services.

As AI becomes more prevalent in industries like finance and healthcare, firms must ensure that their use of AI is transparent and accurate. The fact that KPMG and EY have both withdrawn reports due to AI-related issues highlights the need for robust guidelines and oversight. Developers and businesses must prioritize human validation and verification to maintain credibility.

This also underscores the importance of critical evaluation of AI-generated content, particularly in high-stakes industries. Ultimately, the effectiveness of AI in augmenting human capabilities will depend on the ability of organizations to harness its potential while minimizing its risks.