The AI Told Them To Walk Into Traffic And They Did
Oh good. Another Monday. Another way the flock has found to get themselves fleeced without even needing a Wolf to try very hard.
So here's what's happening. Your shiny AI assistant, the one the Shepherds approved a budget for because it looked good in a deck, is making up web addresses. Just inventing them. Confidently. Like it knows exactly where it's going. It does not know where it's going.
And the Coyotes? They noticed.
They're buying up these hallucinated domains before anyone else can blink, then parking fake grain pages on them. So when your Lambs ask the AI "hey where do I download this tool" and the AI cheerfully fabricates a URL with complete confidence, that URL now belongs to someone who absolutely does not have your best interests at heart.
Unit 42 is calling it phantom squatting, and honestly, I'm annoyed I didn't coin that term first because it perfectly describes this disaster. Ghost real estate, built on AI fever dreams, monetized by criminals. We live here now.
The kicker is nobody had to find a hole in the fence for this one. The AI just drew a map to a field that doesn't exist, the Wolves built the field overnight, and the Lambs trotted right in because the map looked official.
I have been awake for thirty hours. I have four open tickets about this already. One of them is from someone who asked an AI chatbot for a software download link and is now confused why their machine is acting "a little weird." It's not a little weird. It has fleas.
This is the part where I'm supposed to be surprised. I am not surprised. I am tired.
Remediation
Look, I'll keep this short because I need coffee.
Stop letting the Lambs use AI tools to navigate to anything. Treat AI-generated URLs like you'd treat a random URL scrawled on a gas station bathroom wall. Verify it independently. Type it into a browser yourself before you click it. Check the domain registration date. If it was registered last Tuesday, that is a clue.
Block uncategorized domains at the Electric Fence. If it's brand new and unknown, it can wait.
Brief the Flock. Yes, again. No, it won't stick. Do it anyway. Mention that AI makes stuff up sometimes. Watch their faces. Weep internally.
Check for parasites on any machine that went somewhere an AI recommended without verification.
That's it. That's the whole thing. The AI hallucinated a door and the Wolves built one. Patch your processes, not just your systems.
Go touch grass. Actual grass. Not AI-generated grass.
Original Report: https://thehackernews.com/2026/07/phantom-squatting-uses-ai-hallucinated.html