Companies are generating artificial data at unprecedented scale to solve problems most people don't know exist. Synthetic data allows AI systems to create fake training examples that maintain real statistical patterns without containing actual personal information. This reveals a crucial truth: AI systems don't discover knowledge, they learn whatever patterns they're shown - and understanding this changes how businesses should approach AI validation and verification.

Lawyers are getting fined thousands of dollars for citing fake cases that ChatGPT made up. According to researcher Damien Charlotin's 2025 database, there are now 491 documented cases worldwide where AI hallucinations appeared in court filings. This isn't a tech glitch - it's a fundamental business crisis that's spreading across every industry using AI without proper understanding.