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Privacy Risk
Privacy risk in AI refers to the chance that a system exposes, misuses, or infers personal information about individuals, whether through training data, model outputs, or the data flows around an AI tool. For enterprises, it matters because data protection laws such as the EU's General Data Protection Regulation (GDPR) can impose significant fines and require organizations to justify how personal data is collected, used, and retained. Governance teams typically assess these risks before deployment, documenting what personal data goes into a system, who can access it, and whether the model could reveal details about specific people.
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