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Shadow AI in municipalities: what runs next to Copilot

Alongside Copilot, municipalities use Perplexity, ChatGPT and transcription tools, mostly without anyone having decided on them. How to keep track without monitoring staff.

Abstract terraces between hills
Quick answer

Almost every municipality that has rolled out Copilot uses other AI services as well: Perplexity for research with sources, a free ChatGPT account for drafting, a transcription tool for meetings, a translation service at the front desk. That is shadow AI: tools staff picked up themselves, in real use, without the municipality having decided on them. It is not a list of violations but a list of tools still awaiting a decision. A quarterly inventory falls behind, because tools appear faster than a survey can find them. What works is continuously observing which domains are opened in the browser, with no user ID, and recording a decision for each tool.

01

Rolling out Copilot settles nothing about the other AI services; they carry on in a second tab

02

In a municipality the text often contains citizen service numbers, benefit files and youth care details, so the type of account matters a great deal

03

A quarterly inventory describes the previous quarter, not the current working day

04

Recording only the service's domain answers the governance question without watching people

05

A tool without a decision is work still to be done, not an incident

A policy adviser has to write a memo for the municipal executive on a new subsidy scheme and wants to know how five other municipalities handled it. Copilot gives a tidy answer with no sources. In a second tab she opens Perplexity, gets five links and carries on from there. Meanwhile IT has Copilot down as "the municipality's AI tool".

That is how it goes in almost every municipality that has rolled out Copilot. The rollout settled the question for one tool. The others did not go away; they run alongside it, mostly on free accounts, and nobody has decided anything about any of them. That is shadow AI, and it is not a list of violations. It is a list of decisions still to be made.

What runs alongside Copilot?

The list varies from one municipality to the next, but a handful of tools turn up nearly everywhere. They are there for a reason: for that particular job, Copilot is not the obvious choice. Why that happens is covered in our article on why employees turn to other AI tools despite Copilot.

What gets openedWhy people choose itWhat the municipality needs to know
Perplexity or another AI search engineResearch with sources, for a council question or a policy memoFree or business account, and what was in the query
ChatGPT on a free accountRewriting in plain language, summarising, an emailWhether input is used for training, and whether a citizen service number was in the text
Meeting transcriptionMinutes of a team meeting or a council committee without typingWhere the recording is processed, and who was named in the conversation
Translation servicesFront desk and neighbourhood teams, a letter in Arabic or PolishWhether the letter contained personal data
AI features in existing softwareThe word processor or the case system gained an assistant in an updateNo new domain, no new purchasing decision, but a new processing operation

The last row is the awkward one. Nothing new was installed, so nobody requested anything, and yet text now goes to a model it did not go to last year.

Why does this matter more in a municipality?

Because the text being pasted is rarely neutral. A letter about a benefit contains a citizen service number (BSN). A note from a neighbourhood team meeting describes a family's circumstances. An objection letter contains a name, an address and the story behind it. In a municipality, an ordinary working day is full of personal data, and some of it falls into the special categories or is highly sensitive.

Putting that data into a free account is not the same as putting it into an environment the municipality has set up. With a personal account, input may be used to improve the model unless the user turns that off, and there is no data processing agreement. How the account types differ is explained in free versus business AI accounts. The Dutch Data Protection Authority reported several breach notifications in which employees had put personal data into an AI chatbot, and advises organisations to set clear rules on whether this is allowed and, if so, with which data.

The BIO, the baseline information security standard for Dutch government, expects a municipality to have data classification, vendor management and staff awareness in place. An AI service nobody has decided on falls outside all three. How the BIO relates to AI use is covered in our piece on AI under the BIO and NEN 7510.

Why does a quarterly inventory fall behind?

Take a municipality that has allowed Copilot. In March the CISO runs a survey across all departments. Besides Copilot, it turns out that Perplexity, ChatGPT and three specialised tools are in use: a translation service at the front desk, a transcription tool in social services and an AI feature in the word processor. Two of them appear nowhere in the register. That is not an incident. It shows that the register is not keeping pace with the working day.

By June, the March list is already out of date. The case system gained a summarising feature in an update. One team swapped its transcription tool for another that works better with Teams. And a communications officer has started making images for the newsletter with a generator that did not exist in March. Nobody did anything wrong. The survey described March.

Surveying more often does not solve this. Every survey is a snapshot, and our article on why AI tool catalogues age describes the mechanisms behind it: tools appear daily, AI turns up in software you already have and tools change owners. The methods for finding out what is in use, and what each one misses, are set out in our article on finding out which AI tools employees actually use. A municipality has one more thing to contend with: proxy logs see the town hall, not the laptop of a neighbourhood team member working from home.

How do you keep track without monitoring employees?

By recording only what the decision needs. The question is which AI services are opened in the municipality, how often and whether there is a decision on them. To answer it, the domain of the service is enough. Who opened it, which page and what was on it do not change the decision, but they do change the measurement: it stops being a count of services and becomes a record of people. That distinction, and what it means under the GDPR and for the works council, is explained in AI monitoring versus employee monitoring.

So the BeeSensible extension records only the registrable domain, at most once a day per device, with no user ID, no path and no page content. The domains it sees are matched against a catalogue of over 1,000 AI tools, each with its vendor, country, training policy and a risk score. An admin sees which tools have no decision yet and records one; BeeSensible never decides on its own.

AI register
AllowedUnder reviewNot allowedAll tools
Search by tool, vendor, domain or former name…
1,012 tools
DeepSeek
Critical · 90/100
Not allowed
Otter.aiNew
High · 68/100
No decision yet
Grok
High · 67/100
Not allowed
ChatGPT
High · 62/100
Allowed
Perplexity
Medium · 55/100
No decision yet
HeyGen
Medium · 53/100
No decision yet

Every tool, scored for risk

Over 1,000 AI tools, each scored from Low to Critical. Nothing is approved or blocked until someone decides.

More about AI Governance

What BeeSensible does and does not show here is on the product page for See. A phone without the extension stays out of view, and the AI feature in the case system has no domain of its own. For the latter, the rule is to reassess when something prompts it, such as an update or new terms, rather than on a fixed schedule.

What do you do with the list?

Start with whatever is opened most and has no decision. For Perplexity, that means checking whether there is a business tier, what terms it offers and whether research with sources is something the municipality wants to encourage. Often the answer is yes, on one condition: no personal data in the query. That is "Limited use", with the condition in a single sentence.

For the free ChatGPT account the answer is usually "Not allowed", with Copilot or a business tier named as the alternative. That decision only works if it reaches the employee when she opens the tool, not if it sits on the intranet. What such a list of statuses looks like is shown in our article on which AI tools employees may use; the wider topic is covered under AI governance.

The policy adviser in the opening paragraph did nothing wrong, and she does not need to be told otherwise. What the municipality does is notice her tool, decide on it and show her that decision when she opens the tab. Tomorrow the admin will not look at who used Perplexity, but at which tools were opened this month and still have no decision.

FAQ

Common questions

Which AI tools do municipalities use alongside Copilot?

The same ones keep coming up: Perplexity or another AI search engine for research with sources; a free ChatGPT account for rewriting and summarising; transcription tools for council and team meetings; translation services at the front desk and in neighbourhood teams; and AI features that turn up in software the municipality already uses. Exactly which ones, you only find out by observing; it varies by municipality and by month.

Is shadow AI in a municipality a data breach?

Not in itself. An AI service opened without a decision only tells you that nobody has looked at it yet. Whether there is a breach depends on what went into it: a public council paper in a free account is not the same as a benefits file with a citizen service number. The Dutch Data Protection Authority has received breach notifications in which employees had put personal data into a chatbot, so the second situation does happen.

Why is a quarterly survey not enough?

Because a survey is a snapshot of something that keeps changing. Between two surveys new tools appear, existing software gains an AI feature without any new purchasing decision, and people do not report what they do not recognise as AI. The March list was not wrong; it describes March.

Is a municipality allowed to keep track of which AI tools employees open?

To find out which tools need a decision, the domain of the service is enough: that an AI tool was opened in the organisation, which one and how often. Who opened it adds nothing. A measurement with no user ID, no path and no content remains a count of services and never becomes a record of people. Put that in writing and discuss it with the DPO and the works council.

What do you do with a tool that has no decision yet?

Assess it, starting with the tools opened most often. Look at the vendor, the country, whether it trains on input, whether a data processing agreement is available and whether there is a business tier. Then choose: allow it, allow it on a condition or do not allow it and name an alternative. No decision yet is an honest interim status, not an end state.

Portrait of Rens Timmermans from BeeSensible

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