AI Hallucinations, why AI Makes stuff up and how to code your App to solve it.

31 Oct. 2024 - - Total Reads 776

Hallucinations - Why AI Makes Stuff Up

One of the most persistent and dangerous problems in enterprise AI is hallucination — when the model confidently outputs false information. This can include made-up statistics, invented names, incorrect summaries, or even citations that look real but don’t exist.

To the average user, hallucinated content appears valid. The AI sounds sure of itself, which makes it easy to believe. But inside your business, this can cause operational confusion, support overload, and decision-making errors. Externally, it risks damaging your reputation, triggering legal trouble, or violating compliance standards.

What Causes Hallucination?

Large language models (LLMs) are probabilistic. They generate the next most likely word based on patterns — not a database of verified facts. Without strong prompt grounding or contextual reference, they may fabricate details to complete a response.

Example: Hallucinated Product Description

Prompt: “Write a product overview for our new MediScan X5 diagnostic device.”

AI Response (Hallucinated):

“The MediScan X5 features TGA-certified AI imaging, 30TB of data capacity, and was named Product of the Year by the Australian Healthcare Awards.”

Reality:

  • No TGA certification (yet)
  • No such award
  • Spec exaggeration

Strategy 1: Require Source Attribution or References

Force your AI to cite sources, or refuse to answer if none exist.

Strategy 2: Post-Process Outputs for Fact-Checking

Use classification or rule-based tools to verify outputs before releasing them to users. You can layer on API checks (e.g., search-based retrieval) or even human QA for high-risk outputs.

Strategy 3: RAG – Retrieval Augmented Generation

Rather than letting AI invent from scratch, combine it with an external search layer. Here’s a basic flow:

This approach dramatically reduces hallucination by grounding the model in real data.

AI hallucinations aren’t bugs — they’re part of how language models work. The key is to never treat them as authoritative without safeguards. Enterprises need structured fact-checking, data grounding, and output validation to use AI responsibly.

Want to build AI tools that are helpful and accurate? AndMine can help you architect hallucination-resistant systems that scale without compromising trust.

Michael Simonetti, BSc BE MTE
Posted by:

Post Reads: 776

Share this

Go on, see if you can challenge us on "AI Hallucinations, why AI Makes stuff up and how to code your App to solve it." - Part of our 183 services at AndMine. We are quick to respond but if you want to go direct, test us during office hours.

Add Your Comment

Trusted by

intojobs logo
Craft CMS
skillhire logo
The Canberra Times
Bostik
Australian Anthill
TPP
Rock Pool Group
Maxine
Grow Your Business
NMI Insurance
VISSF
Castran Gilbert
DUSA, Deakin University Student Association
Max’s
Chia
The Age
Tassal
OMS – Order Management System
Boston Consulting Group
ISO Certified
itfe logo
Scrum.org
National Museum of Australia
McArthur Skincare
aga logo
Bintani Australia
nara logo
Xavier
Schiavello
Watches of Switzerland
The Royal Melbourne Hospital
Green St Juice CO
Loan Market
findstaff logo
Natralus Australia
QV Skincare
Aqium Gel
Focus On Furniture
Vitura Health
Hanover
Gilbert+Tobin
htn logo
High Street Armadale
Sports Power
learning partners logo
POSTER Magazine
Forbes
Toni&Guy
MAP
Liveoneday
GPT Group
Federation University Australia
Etihad Stadium
Melbourne Sports and Aquatic Centre – MSAC
Engineers Without Borders
Australian Government
AC/DC
Appstore
Metricon
Positive Poster
CAN- Common Wealth Bank
Gadens
Sunday Creek
CCI
Ebay
James Buyer Advocates
Jalna
Australian Physiotherapy Association
Magento Solution Specialist
Uber
Movember
Jetstar
OpenAI
RMIT University
Paypal
Australian Organic Food CO
Street Kitchen
Fairfax Media
ACTUATE IP
Peter Mac
Madman Entertainment
Elucent
Cooper Mills
University of South Australia
Inferflora
Victorian Government
WTFN
Celebrate Health
White Suede
Matchbox Homewares
Fit My Car
Tomorrow Stars Basketball
Amino Active
Magento
Shell
Brisbane Times
Cronos Australia
mas national logo
Kadac
ADP Payroll
Viktoria & Woods
Passage Foods
MyAccount
Rackspace
Herbert Smith Freehills
Bolle Safety
Crumpler
Heat Holders
Dial Before You Dig
Ego Pharmaceuticals
Tek Ocean
Van Egmond Group
Think & Grow Rich Inc
Thomson Geer
Plants
Vendor Advocacy Australia
Rydges
Hairhouse Warehouse
Associated Press
News
Bulk Nutrients
Mark Alexander Design
GooglePlay
OJAY
Macmillan Publishing
Tribe
Palace Cinemas
Kay&Burton
Moov Head Lice
Cleanfit
Ubertas Group
ctc logo
131 Pizza
The University Of Melbourne
NextTech
Drupal
Adobe Professional
Bigcommerce
Oakdale Meat Co
Carlton Football Club
DeeWhy Market
Instant RockStar
Federation Square
Arthur Galan
ABC
iPrimus
Engine Swim
The Burger Cheese
Melrose MCT
ATT logo
Melbourne Central
SunSense Digital Agency
Passage To India
Taylor Rose
Parker Lane
work and training logo
Grainshaker
Switzer Media+Publishing
Fast.co
Macpherson Kelley
Unsw Australia
Bank of Cyprus
One Shift
liberal
Windsorsmith
Grays Ecommerce
Novvi
Smart Company
intowork logo
Acquia Certified Site Builder Drupal
Dinosaur Designs
NGS Super
Telstra
SMH – The Sydney Morning Herald
Ello
HGG 
PranaOn
Oracle
Naturtint
Fresh Cheese Company
Banki Haddock Fiora
Bondi Sands
Microsoft Certified Azure Fundamentals
ISO CERTIFIED 27001
Google
Wild Rhino Shoes
Mamma Lucia
Garmin
Catholic Insurance
Atlantic Group of Companies
nextgenskills logo
SwinBurne University of Technology
interact logo
Cell Therapies
LBG Australia and New Zealand
Toy World
Royal Freemasons
Florsheim Shoes
National Relay Services
Launtel
The Fortune Institute
Melrose Health
CB Richard Ellis
Marshall White
Globird
Eway
kestrel logo
Mecca Brands
King Wood Mallesons
21st Century Australia Party
Arc One
Beaumont
French Tables
Coles
BlackMores
Melbourne Heart
help logo

Testimonials

AndMine's Marketing Software ensures we stay on-brand no matter who in our office creates the campaign. We love that AndMine take all the IT complexity out of our online marketing so we can focus on results Emma Gleeson, QV Skincare

More Testimonials
AndMine-Google-Partner-Signature