A recent cyberattack on a Mexican municipal water and sewage utility's operational technology systems highlights the potential and limitations of AI-powered attacks. The hacker utilized AI-developed tools, including Claude and Chat GPT, to generate high-volume, noisy workflows, leveraging known techniques and existing vulnerability knowledge. Forensic analysis by OT security firm Dragos revealed that the attack, which occurred in January, exploited existing weaknesses rather than introducing new, AI-generated vulnerabilities. The use of AI in this attack demonstrates its capability to amplify and automate existing threats, but also underscores its limitations in creating novel exploits. The incident has significant implications for policymakers and technology organizations, as it underscores the need for compliance with emerging regulations and strategic planning to mitigate AI-powered threats1. This matters to practitioners as it emphasizes the importance of addressing existing vulnerabilities and developing strategies to counter AI-augmented attacks.