I saw the news last week and just sat there staring at nothing for a while

An AI startup goes under, and then both the former CEO and CFO get charged with fraud. This isn't some distant cautionary tale — it happened right in the middle of the peak AI startup frenzy of the last couple of years. My first reaction wasn't "serves them right." It was: at what exact moment did they first tell that slightly-off version of the truth?

I've made a smaller version of the same mistake myself. In a proposal to a potential client, I wrote "we have this capability" when what I meant was "we're currently testing this feature." At the time it felt like just a phrasing choice. When that client actually came back to follow up, I spent three times as long patching the hole. That's when I started seriously asking myself: when it comes to describing what I can do, where exactly is the line?

What this case actually is — and why it's closer to us than it looks

The Reuters-reported case comes down to one core allegation: the picture the company painted for investors bore almost no resemblance to reality. In plain language — the hype outran the execution, money came in, deliverables didn't follow, and that became fraud .

I know someone who does brand consulting — her name is Xiaowen, based in Shanghai. Last year she started doing interviews and podcast appearances, saying she had "served over 50 brands." What she didn't mention was that more than 30 of those were client projects her employer took on while she was a salaried employee — she was part of the execution team, not the lead. She told me: "I thought that counted as my experience. I didn't see the problem." Then a major prospect ran a detailed background check and asked very specific questions. She said she completely panicked.

Xiaowen's situation didn't cross into illegal territory, but that line is thinner than most of us assume. Misle ading investors and misleading clients carry different legal risks — but the damage to your reputation and the trust people place in you is equally fatal either way.

So what do I actually do about it now ? I use a simple but effective method: in any external-facing description, I separate " what we can do," "what we're currently doing," and "what we've already done" into three distinct statements. Three sentences, each doing its own job.

One small thing you can do today (cost: $0, 15 minutes, no tools required)

No software purchase needed. No technical knowledge required. Just do this one thing:

Pull up the bio or introduction you currently use publicly — your Instagram or LinkedIn bio, a pinned social post, the opening paragraph of your client proposals — read it once, and list out every sentence that contains "we can…," "we've already…," or "we've worked with…."

Then ask yourself: if a client pressed me on this face to face, could I walk them through it clearly and specifically?

If you couldn't, rewrite it. Not because you're low ering yourself — but because precision is what actual professionalism looks like . Vague, sweeping claims are exactly what makes people dist rust you.

The first step: open the intro document you use most often right now, find the first "we've already…" in it, and ask yourself that question.

My take , depending on where you are

If you're just starting out with no clients yet: The most common mistake at this stage is turning "I've studied / I've researched this " into "I'm skilled at / I've mastered this." I'd suggest building the habit now — use "I focus on…" instead of "I'm an expert in…", and "I'm currently working with…" instead of "I've worked with many…." This doesn't make you sound weak. It makes you sound honest, and early on, honesty is the most valuable trust asset you have. You don't have to fix it today — but the earlier the better.

If you already have one or two clients: You're starting to build a case portfolio, and this is exactly when you need to be careful: results need to be real numbers, and your role needs to be clearly defined. "Helped a client gain 3,000 followers" and "was part of a team that helped a client gain 3,000 followers" mean very different things. I'd suggest writing a "factual version" of each case and keeping it for yourself — use a condens ed version externally, but make sure you know the full picture internally.

If you're scaling up and starting to fundraise or land enterprise clients: This is where a misstatement costs the most. Before any formal proposal or fundraising document gets finalized, I'd suggest having someone who's not involved in the project read it through and flag anything they'd ask "can you actually prove this?" A lot of people skip this step because it feels like extra hassle — but it's the last buffer before you cross that thin line. This isn't something everyone needs — but if you're already negotiating contracts over $100K, it's worth taking seriously .