KPMG Retracts Flagship AI Report After AI Hallucinations Exposed

KPMG’s October 2025 report “Total Experience: Redefining Excellence in the Age of Agentic AI” was withdrawn after GPTZero found only five of 45 citations genuine. The remaining references fabricated case studies for UBS, NHS Greater Manchester, Transport for London, Swiss Federal Railways and an Emirates chatbot claim. KPMG removed the report and began a review.

The Register UK

The issue follows a wave of AI-generated errors in consulting. Deloitte’s Australian review required a refund, EY withdrew a cybersecurity study, and GPTZero coined “vibe citing” for fabricated references.

The Big Four are selling AI governance while their own reports hallucinate

45 citations were listed; only five (?11 %) were verified, while 40 (?89 %) were fabricated, resulting in about 50 % false claims. It claimed 55 % of CEOs rank AI as a top investment priority, contradicting KPMG’s 2025 CEO Outlook (71 %). GPTZero reported 56 % of employees experience AI-induced mistakes and 66 % use AI outputs without verification (48,340 respondents, 47 countries).

The Register UK

KPMG’s spokesperson said the firm “takes the accuracy and integrity of its published content seriously,” noting the report’s removal and a review. UBS, Swiss Federal Railways, Transport for London and NHS Greater Manchester said the AI-agent claims were incorrect. Paul Esau admitted no human double-checked the citations before publication.

KPMG AI Report Hallucinations — UBS NHS TfL — Finance Monthly

GPTZero called the errors “vibe citing” and warned that fabricated references can spread through publications and large language models. CEO Edward Tian said the problem is escalating, citing recent EY and Deloitte incidents. Critics argue unchecked generative AI erodes client trust and amplifies misinformation.

The Register UK

• “These factual errors are not confined to the report’s footnoted passages,” — GPTZero

The Register UK

• “On page 42, the authors claim that Emirates airline has adopted a mobile chatbot named Sara (false) that can converse directly with passengers (partially true) and change their flights (false). In fact, Sara is a robot assistant introduced by Emirates in 2023 (not a chatbot) that lacks the ability to alter flight bookings.” — GPTZero

The Register UK

• “KPMG International takes the accuracy and integrity of its published content seriously. The report has been removed and we are reviewing the circumstances surrounding its publication. 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.” — KPMG spokesperson

The Register UK

• “We suspect no human at KPMG double-checked the citations, the claims, or the sources before Total Experience was published.” — Paul Esau, report author

KPMG report on AI found riddled with AI hallucinations

The case reveals a credibility gap for firms that advise on AI governance while their own research contains AI-generated falsehoods. Erroneous data can be amplified by media and incorporated into training sets for models like ChatGPT, creating a feedback loop that may mislead corporate strategy.

KPMG Retracts Flagship Report After AI Hallucinations Exposed

KPMG has pledged a comprehensive internal audit and is revising its AI-authoring protocols. Regulators in several jurisdictions are weighing mandatory AI-author disclosures and independent audits for consultancy outputs. Industry observers expect heightened scrutiny of AI-assisted research across the professional-services sector.

KPMG Retracts Flagship Report After AI Hallucinations Exposed