AI Washing Due Diligence Just Flipped: The Human-in-the-Loop Gap
The entire AI washing due diligence apparatus just flipped: catch the company that pretends NOT to have artificial intelligence. Using a cheap, fully observable case study of a $1,900 meta-analysis product, DevelopmentCorporate documents a critical “Human-in-the-Loop Gap” that scales directly to enterprise SaaS: the assertion that a human is in the loop is, in almost every commercial context, completely unaudited. When human delivery is priced below its labor cost, that pricing is the tell. This analysis maps the margin incentives behind this “human-washing” rational, legal exposures under the newly applicable Article 50 of the EU AI Act, and introduces a seven-point Human-in-the-Loop Verification Protocol for diligence teams.
