Tuesday, August 26, 2025

The Hidden Risks of AI: Hallucinations, Indirect Prompt Injection, and Jailbreaks

I have read an excellent article analyzing the most popular AI vulnerabilities, organized into three most common categories of AI security issues:

  1. Hallucinations
  2. Indirect Prompt Injection
  3. Jailbreaks

 

1. Hallucinations – When AI Makes Things Up

Hallucinations occur when AI generates information that is factually incorrect or entirely fabricated.

Example: An AI assistant inventing sources in a research report.
Risk: Inaccurate data could lead to flawed business decisions, compliance failures, or even legal disputes.

Hallucinations are perhaps the most visible weakness, in Generative AI applications like chatbots and copilots.

 

2. Indirect Prompt Injection – Hidden Manipulations

Indirect prompt injection happens when malicious or unexpected instructions are hidden in external content, which the AI then processes.

Example: A piece of text or metadata hidden in a document that tricks the AI into revealing confidential data or executing unintended actions.

Risk: Unlike hallucinations, this issue is harder to detect because it leverages trusted inputs to manipulate the system from within.

This type of vulnerability can compromise enterprise workflows where AI processes documents, emails, or data pipelines.


3. Jailbreaks – Cracking the Guardrails

Jailbreaking is the process of bypassing built-in safeguards and forcing an AI model to behave outside of its intended restrictions.

Perception: In open systems (like chatbots for experimentation), jailbreaks are often dismissed as harmless fun.

Reality Check: In closed enterprise systems, jailbreaks can become extremely dangerous. Imagine a cleverly crafted prompt that manipulates the AI into:

  • Revealing confidential business strategies
  • Exposing sensitive client data
  • Circumventing compliance requirements

As soon as malicious actors (or even “talented” insiders) manage to shift security responsibilities from traditional IT layers into the AI decision layer, jailbreaks stop being a niche concern and become a critical security risk.

The full article with detailed information about vulnerabilities - The Price of Intelligence

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