AI Chatbots in the Legal Industry: Potential Risks and Benefits In 2024

Ai chatbots, person using mobile chatbot

Imagine a potential client visiting your law firm’s website with a pressing legal question. An AI chatbot could be their first point of contact, offering the advantage of 24/7 availability to answer basic legal questions, screen inquiries for urgency, and even schedule consultations. 

However, this seemingly helpful technology can backfire. A potential client contacts the online chat, expecting a quick and useful response. But instead of receiving accurate information, the AI chatbot mistakenly sends them down the wrong legal path, causing significant delays and potentially jeopardizing their case. 

While AI chatbots hold promise for the legal industry, the potential for such mishaps raises serious concerns. This article will examine the current limitations of AI chatbots and explore the legal risks associated with their use in the legal field. We’ll also discuss how law firms can navigate these challenges and ensure responsible technology implementation.

An Overview of AI Chatbots in Law

Nearly everyone is familiar with online chat support. Most law firm websites have a vendor they use to handle online chat leads. Real people manage most with scripts for different situations they follow. They can also connect someone with an attorney. 

AI chatbots differ because there is no human quality control over the chats. An AI chatbot can be given directions, but similar to a human, there is a chance it will not follow them. Even worse, it can decide what to respond with, resulting in made-up or inaccurate information.

Now, let me clarify some things. The terminology is easy to mix up because we can say chatbot and refer to a tool like ChatGPT, or we can say chatbot and refer to something like your live chat on your website. For this article, we are covering your website and using AI-powered chat. We will reference some articles on tools like ChatGPT, but the main focus is the website chat option.

In one example of AI misbehavior, it tells people to break the law, which you can read more about in the article on Reuters. Now imagine if your law firm used an AI chatbot and it gave out inaccurate legal advice that caused harm to a potential client or a current client. What would the potential repercussions be? Would the state bar take action against your firm? Could it cause damage to your brand or business? Is the risk worth it? We think not at this stage.

AI chatbots are just as capable of making things up or giving inaccurate information as various AI tools like ChatGPT, Llama, Claude, Gemini, etc. This is not a risk a law firm should take. There is a place for testing and primetime use, but we are not at that point yet. For more on the privacy and concerns of using AI chatbots in-house, you can check out this article.

Common and Uncommon Challenges in AI Chatbot Integration

Privacy is the first concern for an AI-powered chat on your website that communicates with potential clients. If the chatbot is not isolated from the company behind it, then the information being put into it could be used to train specific models. If you use the retail version of ChatGPT, it can use anything you input to train the model, which means if a person’s private information was entered, it could show up in the wild later.

This is where personal identifiable information (PII) becomes critical. You do not want users to input certain confidential information. Since there is attorney-client privilege, you need to make sure whatever AI chatbot you are playing with is not sending the client’s information outside your law firm.

Data Privacy and Security

AI chatbots that collect user data without proper isolation or user consent can lead to privacy breaches and misuse of PII. This could include sensitive data accidentally being exposed or used to train the chatbot, potentially leaking confidential information.

An example would be a law firm using a generic AI chatbot that might inadvertently collect client data that gets integrated into the training model, leading to potential breaches of attorney-client privilege.

To prevent this, a law firm should implement data security measures, clearly outline data collection practices in a privacy policy, and only collect the minimum information necessary for the chatbot’s function. Additionally, consider using legal-specific AI chatbots designed with privacy in mind.

Compliance Issues

AI chatbots may not be programmed to comply with relevant regulations, such as: 

  • GDPR (data protection)
  • HIPAA (healthcare data)
  • California’s Bot Disclosure Law (California Business and Professions Code § 17940)

Non-compliance can result in hefty fines and reputational damage.

An example is a law firm in California that uses an AI chatbot that doesn’t disclose its AI nature, violating the state’s transparency law.

You must ensure the AI chatbot adheres to all relevant legal and ethical guidelines to prevent violations. Conduct regular compliance audits and update the chatbot as regulations evolve.

Risks Of AI Inaccuracy and Misinformation

Due to limitations in their training data or programming, AI chatbots can provide inaccurate or misleading legal information, which can have severe consequences for clients who rely on it. We mentioned the NYC example earlier, where it told people to do something that was a crime.

To avoid this, you need a high-quality chatbot with accurate legal data and integrated fact-checking mechanisms to verify information before responding. Human oversight and review are also critical. If you want to be on the cutting edge of technology, test it in-house. Have your staff use it to ask clients’ questions and see what sort of responses you get. See if they can break it and get it to return inaccurate information or something that could cause your potential clients or business harm.

Cross-Jurisdictional Complexity

AI chatbots may not be able to handle legal nuances across different jurisdictions. The chatbot may provide incorrect information or advice if it isn’t programmed for specific regions.

For example, a law firm with clients in different states uses a generic AI chatbot that provides legal advice based on a single state’s laws, potentially misleading clients in other states with different legal frameworks.

Ensure the chatbot is tailored to specific legal jurisdictions and disclose geographical limitations in chatbot functionality. Consider offering language translation options for clients.

Emotional Distress Management

AI has no emotions, which is a sticking point. Imagine your clients who reach out via an AI chatbot with emotionally charged inquiries and do not get the ideal customer service experience, which can lead to further frustration and distress for the client. AI may just respond without acknowledging the emotional aspects of the conversation. That is not ideal customer service for a law firm that deals with clients who are often under emotional pressure and need a gentle touch in how they are communicated to. This could lead that person to go elsewhere.

Always have an option to connect with a human representative for complex and emotionally sensitive matters.

While AI chatbots hold great potential for streamlining legal services and improving client access, their limitations require a cautious approach in the legal industry. By prioritizing data security, ensuring compliance, and focusing on accurate legal information, law firms can explore responsible implementation of AI chatbots to enhance the client experience without compromising the quality of legal services. If you have questions or need help vetting an AI chatbot vendor, you can contact us at (800) 278-5677 or