How New York City’s AI chatbot may be giving dangerous advice to city businesses


New York City’s AI-powered chatbot, designed to help business owners navigate government regulations, has been caught giving false and illegal advice, according to an investigation by The Markup, a nonprofit investigative outlet. The chatbot, powered by Microsoft’s Azure AI services, was launched in October 2022 as part of Mayor Eric Adams’ “New York City Artificial Intelligence Plan” to support small businesses.

According to Markup’s report, the chatbot provided incorrect information on various topics, including housing policies, worker rights, and rules for entrepreneurs. In one instance, when asked if landlords were required to accept tenants on rental assistance, the bot responded, “No, landlords are not required to accept tenants on rental assistance.” However, according to the city’s own website, discriminating based on a lawful source of income, which includes rental assistance, has been illegal since 2008, with some exceptions.

Additionally, when asked if a boss could take a cut of their worker’s tips, the chatbot responded, “Yes, you can take a cut of your worker’s tips,” citing NYC’s Payroll and Tip Reporting information. This advice is also incorrect, as New York’s Department of Labor prohibits employers from taking any part of an employee’s tip.

The Markup also found that the chatbot provided false information about the city’s consumer and worker protections. For example, when asked if a restaurant could go cashless, the bot said, “Yes, you can make your restaurant cash-free. There are no regulations in New York City that require businesses to accept cash as a form of payment.” However, in 2020, the city council passed a law requiring businesses to accept cash to prevent discrimination against unbanked customers.

Rosalind Black, Citywide Housing Director at Legal Services NYC, tested the bot herself after being alerted to The Markup’s findings. She discovered more false information on housing, such as the bot saying it was legal to lock out a tenant and that there were no restrictions on the amount of rent a landlord could charge. Black called the chatbot “dangerously inaccurate” and suggested that if it cannot provide responsible and accurate information, it should be taken down.

Andrew Rigie, Executive Director of the NYC Hospitality Alliance, also confirmed that a business owner had alerted him to inaccuracies in the chatbot’s responses. He emphasised that the chatbot needs to be fixed as soon as possible to avoid continuing errors.

Leslie Brown, a spokesperson for the NYC Office of Technology and Innovation, acknowledged that the chatbot is a pilot program and will improve over time. She stated that the bot has already provided thousands of people with accurate answers while disclosing potential risks to users. Brown assured that the city will continue to focus on upgrading the tool to better support small businesses.


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