Italy’s top competition and consumer protection authority, AGCM, has launched an official investigation into Chinese artificial intelligence startup DeepSeek, raising concerns about the platform’s potential to mislead users with false or inaccurate content.
The probe, announced on Monday, centers around allegations that DeepSeek failed to adequately warn users that its AI-generated responses may include errors, misleading claims, or completely fabricated information — a phenomenon known in the AI field as “hallucinations.”
In a statement, AGCM accused DeepSeek of not providing “clear, immediate, and understandable” disclosures regarding the possibility of such hallucinations. The watchdog emphasized the importance of transparency, especially when users may rely on the AI’s output for important decisions or factual information.
Hallucinations in AI occur when a model, like a chatbot or digital assistant, produces content that seems realistic but is factually wrong or made up. This issue is common across many large language models, but regulators are increasingly concerned about how well platforms communicate this risk to users.
DeepSeek has yet to respond publicly to the investigation or provide a comment to news outlets, including Reuters, who reached out via email.
This isn’t DeepSeek’s first clash with Italian authorities. In February 2025, the country’s data protection regulator ordered the company to suspend access to its chatbot within Italy after it failed to meet privacy and data protection standards. That incident raised alarms about user data security and responsible AI usage, setting the stage for further scrutiny.
The current case adds to a broader global trend: governments and regulators are keeping a closer eye on AI tools that are rapidly entering consumer markets. From chatbots and search assistants to content creation tools, the demand for transparency and safety is growing louder.
Italy’s AGCM plays a dual role in both regulating fair market competition and protecting consumer rights. This latest move signals its intent to ensure that emerging technologies like AI meet the same legal and ethical standards as traditional businesses.
For users, the investigation serves as a critical reminder: not everything generated by AI is trustworthy, and caution should always be exercised, especially when relying on information for decisions related to health, finance, education, or legal matters.
With the growing popularity of AI platforms globally, regulators are pushing for stricter guidelines to prevent misinformation and protect public trust.
