The Overlooked Risks of Chatbot Deployments

AI chatbots have become a practical way for businesses to answer questions faster, extend support beyond business hours, and reduce routine workloads. But successful chatbot use depends on more than just choosing the right tool. Fisher Phillips highlights ten common deployment pitfalls—and the precautions that help reduce the legal, privacy, and operational risks.

Many are already guarding against key concerns. Organizations are deploying risk assessments, bot disclosures, human-in-the-loop controls for employment contexts, and baseline vendor due diligence as increasingly standard starting points in AI governance. But less obvious and faster-moving risks still remain:

1. State “wiretapping” exposure and the class action trend. Plaintiffs’ lawyers have argued that chatbot providers and the surrounding website tech stack can capture substantive visitor communications without adequate consent.

• Precaution: Inventory every tool that touches a chatbot, disclose that the chat may be recorded, and include an affirmative click-to-consent before the chat begins.

2. Privacy drift and confidential input risks. Chatbots tend to collect more personal and confidential information than businesses intend, and transcripts can become sensitive datasets.

• Precaution: For external chatbots, build a data-flow map that documents what’s collected, where it goes, who can access it, and how long it’s retained. Audit this against your privacy notices. For internal chatbots, adopt a written acceptable-use policy that spells out what information employees may and may not include, especially confidential, personal, or regulated data.

3. Ignoring the “companion creep” problem. Without boundaries, bots can slide into “companion” behavior where bots trained for business unit chat start offering emotional support or personal guidance.

• Precaution: Monitor conversation logs to ensure the bot is being used in accordance with the defined business purpose and set prompt configurations to prevent engaging in personal conversations.

4. No human escalation protocols. Without escalation triggers, high-risk chats—threats, harassment, self-harm indicators, legal complaints—create serious legal concerns.

• Precaution: Define purpose and tone, continuously tune prompts and safety filters, and route flagged interactions to train humans with clear playbooks.

5. Treating launch day as the finish line. AI is constantly evolving and the bot may look much different than when it was initially deployed.

• Precaution: Monitor logs, audit performance, update disclosures, retrain staff, and retest after model or regulatory changes.