US Federal Trade Commission opens investigation into OpenAI

July 14, 2023 07:02

US media reported that the US Federal Trade Commission (FTC) has launched an investigation into OpenAI for allegedly violating consumer protection laws.


OpenAI and ChatGPT logos

The Washington Post reported on July 13 that the FTC sent a 20-page request this week for records on how OpenAI handles risks associated with its artificial intelligence (AI) models. The FTC is currently investigating whether OpenAI engages in deceptive practices or practices that harm consumers’ reputations.

The FTC and OpenAI have not yet responded to the report. However, analysts say the move represents the strongest legal action yet against OpenAI, a startup backed by tech giant Microsoft, as its generative AI products have captivated consumers and businesses, but have also raised concerns about potential risks.

As the race to develop AI services accelerates, regulatory oversight of the technology is also intensifying. In May, Reuters reported that global regulators are moving toward applying existing rules, covering everything from copyright and data privacy to the two key issues of data fed to AI models and the content those models generate. In the US alone, Senate Majority Leader Chuck Schumer has called for “comprehensive legislation” to promote and ensure AI-related protections, and said he would host a series of forums after 2023.

OpenAI also ran into legal trouble in March this year when the Italian Data Protection Authority (Garante) ordered the company to suspend the ChatGPT chatbox in the country due to suspected violations of European Union (EU) privacy rules. ChatGPT was reinstated in the southern European country after OpenAI agreed to install age verification features and allow European users to prevent their personal information from being used to train AI models.

According to VNA

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US Federal Trade Commission opens investigation into OpenAI