There is no exemption for AI when it comes to consumer facing applications, the Federal Trade Commission recently stressed in a blog post.

Key points:

  • Quietly changing the terms of service agreements could be unfair or deceptive: Any firm that reneges on its user privacy commitments risks running afoul of the law. It may be unfair or deceptive for a company to adopt more permissive data practices —for example, to start sharing consumers’ data with third parties or using that data for AI training — and to only inform consumers of this change through a surreptitious, retroactive amendment to its terms of service or privacy policy.
  • If you promise that you won’t use customer data for secret purposes, such as to train or update their models — be it directly or through workarounds — don’t. Doing so may be a violation of the law and the FTC has and will continue to require the unlawfully gotten data to be deleted.
  • Claims of privacy and security do not shield anticompetitive conduct. The FTC will closely scrutinize any claims that competition must be impeded to advance privacy or security.