Italy Opens Probe into AI Firm DeepSeek Over Hallucination Risks
In a move to ensure transparency and accountability in the use of artificial intelligence (AI), Italy’s antitrust body has launched an investigation into Chinese AI firm DeepSeek, alleging that it failed to warn users about the risk of “hallucinations” in its AI-produced content. Hallucinations refer to situations where the AI model generates inaccurate, misleading, or fabricated information in response to user inputs.
The investigation, which was announced on June 16, 2025, is a significant development in the ongoing debate about the risks and benefits of AI. DeepSeek, which is a leading provider of AI-powered content generation solutions, may face fines of up to €20 million or 4% of its global annual turnover if found guilty of violating Italy’s transparency law.
The Italian antitrust body, known as the Italian Competition Authority (AGCM), has accused DeepSeek of breaching the country’s transparency law by failing to provide clear information to users about the potential risks associated with its AI-generated content. The agency claims that DeepSeek’s failure to disclose this information has led to users being unaware of the inaccuracies or fabrications that may be present in the content generated by its AI models.
The investigation is a response to a series of complaints filed by Italian consumers who claimed to have been misled by DeepSeek’s AI-generated content. The complaints alleged that the content was inaccurate, biased, or fabricated, and that DeepSeek had failed to provide adequate warnings or disclaimers to users.
DeepSeek’s AI models use machine learning algorithms to generate content based on user inputs, such as search queries or writing prompts. However, these models can sometimes produce inaccurate or misleading information, which can have serious consequences, such as spreading misinformation or damaging reputations.
The Italian antitrust body has accused DeepSeek of violating the country’s transparency law, which requires companies to provide clear and concise information to consumers about the risks and limitations of their products and services. The law also requires companies to provide adequate warnings or disclaimers to users about potential risks or inaccuracies.
The investigation into DeepSeek is the latest in a series of actions taken by European regulators to ensure the transparency and accountability of AI-powered content generation solutions. In recent years, there have been growing concerns about the potential risks and consequences of AI-generated content, including the spread of misinformation, biased or discriminatory content, and the potential for AI-generated content to be used for malicious purposes.
The Italian antitrust body has called on DeepSeek to provide evidence that it has taken adequate measures to prevent the generation of inaccurate or misleading content, and to provide clear information to users about the potential risks associated with its AI-generated content. DeepSeek has been given a deadline of August 15, 2025, to respond to the allegations and provide evidence of its compliance with the transparency law.
If found guilty of violating the transparency law, DeepSeek could face fines of up to €20 million or 4% of its global annual turnover. The company may also be required to take corrective action to ensure that its AI-generated content is accurate and transparent.
The investigation into DeepSeek has significant implications for the AI industry as a whole. It highlights the need for companies to ensure that their AI-powered content generation solutions are transparent, accountable, and free from inaccuracies or biases. It also underscores the importance of regulatory oversight and enforcement in ensuring that companies comply with transparency laws and regulations.
As the use of AI-powered content generation solutions continues to grow, it is essential that companies prioritize transparency, accountability, and accuracy in their products and services. The investigation into DeepSeek serves as a reminder of the importance of regulatory oversight and enforcement in ensuring that companies comply with transparency laws and regulations, and that users are protected from inaccurate or misleading information.
Source:
https://www.reuters.com/world/china/italy-regulator-opens-probe-into-chinas-deepseek-2025-06-16/
