arXiv:2510.11812v1 Announce Type: cross Abstract: Large language models (LLMs) such as GPT, Gemini, and Claude often appear adept at solving classic logic puzzles--but how much genuine reasoning underlies their answers? Recent evidence suggests that these models frequently rely on memorized templates rather than reasoning from first principles. When puzzles are slightly modified, their performance collapses, revealing a striking fragility. In particular, we asked: Have LLMs addressed these issues? To what extent? How about perturbations to other puzzles? Is there a general way of reformulating the prompt so that the models do better? To examine these things systematically, we introduce PHANTOM RECALL, a benchmark comprising 25 well-known logic puzzles and 149 carefully designed perturbations that preserve reasoning structure but alter superficial details and solutions. We evaluate eleven leading LLMs and identify a recurring failure mode--phantom recall--where models confidently reproduce memorized solutions or spurious rationales that no longer fit the altered scenario. To probe and mitigate this issue, we contribute three tools: (i) an automated logical-equivalence judge to detect reasoning mismatches, (ii) a taxonomy of fine-grained reasoning error categories, and (iii) a prompting-based mitigation framework guided by these categories. Despite near-perfect accuracy on unmodified puzzles, models significantly underperform humans on perturbed ones, exhibiting both phantom recall and over-elaboration. Our findings reveal a crucial limitation: LLMs often fail to re-reason when contextual cues shift--highlighting the gap between linguistic fluency and logical understanding.