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NYC Mayor Mamdani Pulls Plug on Dysfunctional $600,000 AI Chatbot

Chatbots

Business Honor
04 Febuary, 2026

Underperforming Digital Platform Terminated After Revealing Critical Errors in City's Technological Strategy.

In a major administrative decision intended to demonstrate that there is a zero-tolerance approach to poor performance associated with technology, New York City Mayor Mamdani has essentially pulled the plug on the city’s ineffective AI Chatbot and has called a halt to a $600,000 digital initiative that did not produce reliable information.

The Mayor’s offensive strategy will address New York’s $12 billion budget deficit, of which the AI Chatbot is a prime example of wasteful spending. The Mayor stated, “The previous administration’s AI Chatbot was un-useable in a functional manner,” in issuing a scathing review of the performance of that digital system.

The MyCity Chatbot is powered by Microsoft’s Azure AI system and was a technology liability to the city of New York in that there were multiple critical failures, such as providing inaccurate guidance concerning labor laws and business regulations that could be detrimental to the small business owner. One of the more glaring examples would be when the chatbot advised businesses that they could withhold a portion of an employee’s tip(s), which is a violation of New York City’s labor laws. Another significant error would include the chatbot advising the business that they could go “cashless,” which is a violation of a citywide law passed in 2020 banning cashless businesses.

The final score for the chatbot: terminated. In its place, a short message tells users where to go instead (NYC.gov), effectively ending the bot's brief and troublesome existence. The way Mamdani has approached this matter is indicative of a larger strategy for technological accountability. "It is an indication of how much money has been spent on these projects without an accurate accounting of what the actual costs were," said the mayor, putting the end of the MyCity Chatbot into a larger framework of project failure.