FTC Demands True Claims About AI and Warns of Regulatory Action

The Federal Trade Commission (FTC) is stepping up scrutiny of companies’ artificial intelligence (AI) claims, warning that it will hold companies accountable for unsubstantiated promises. on Axios. Samuel Levine, director of the FTC’s Bureau of Consumer Protection, emphasized the agency’s commitment to pursuing true and legitimate AI-related claims in a recent interview with Axios.

Levine emphasized that all companies, whether they deal with artificial intelligence or those that use its processes, are subject to the same sets of rules. “If companies make claims about the use of artificial intelligence or its capabilities, these claims must be truthful and substantiated, otherwise we are prepared to take action,” Levine said, adding that these were not empty threats.

Regulatory landscape

According to Axios, Levine suggested that there is no immediate need for a dedicated “Office of Artificial Intelligence,” given the widespread integration of AI across various sectors, including technology, pharmaceuticals and retail. This broad application gives the FTC a unique vantage point from which to monitor AI’s impact on the marketplace.

“We expect companies to do the truth, and our track record shows we are willing to go to court to hold them accountable,” Levine said. He explained that existing regulations and obligations for companies remain unchanged with the advent of AI, but the FTC is especially wary of AI being used to “turbocharge” fraudulent activity.

Related: FTC Monitoring Competition in Artificial Intelligence

Legal framework and challenges

The FTC Act remains a powerful tool for the agency to combat false advertising, discrimination, and other harmful behavior related to AI. However, Levine noted that additional resources are needed to make the agency more effective. He highlighted a significant setback since 2021, when the Supreme Court limited the FTC’s ability to provide cash to consumers.

“Congress giving us this tool to refund people who have been defrauded and making sure we have the resources to confront what we believe will be the true scourge of AI fraud is essential for us to do our job.” added. – said Levine.

Recent enforcement actions

The FTC’s vigilance toward AI-related claims has already led to significant enforcement actions. Last year, Rite Aid was banned from using artificial intelligence-based facial recognition technology for five years after the FTC found it was used without appropriate safeguards. Additionally, Automators AI was permanently punished for misleading consumers with promises of quick financial gains through its technology.

Recently, the American Civil Liberties Union (ACLU) filed a complaint with the FTC calling for an investigation into the hiring of technology provider Aon. The ACLU accused Aon of deceptive marketing, saying its technology was “bias-free” and could “improve diversity.” While Levine declined to comment on the matter, he confirmed the FTC’s willingness to address similar issues.

The FTC’s position on artificial intelligence regulation

Levine’s message to the private sector is clear: The FTC will not rely on self-regulation as it did in the early days of Web 2.0. “We do not close our eyes and hope that self-regulation will protect society,” he assured. “We believe that if AI is successfully implemented… we need to be proactive.”

source: Axios