With artificial intelligence (AI) becoming a hot topic for Web3 and the rest of the world to see and embrace, it should come as no surprise that the Federal Trade Commission (FTC) has turned its attention to OpenAI, the creator of ChatGPT, in a new study, according to an initial report from The Washington Post.
The agency sent the San Francisco startup a 20-page letter asking for answers about how it handles ongoing complaints of consumer data misuse and instances of “hallucination,” i.e. instances where ChatGPT fabricated facts or stories that caused reputational damage.
The FTCs ask
OpenAI will now serve as the FTC’s first public case study on how the agency is beginning to enforce consumer protection warnings related to AI while addressing potentially unfair or deceptive business practices. The company’s co-founder, Sam Altman, testified before Congress in May, inviting AI legislation to get into the mix.
In the letter, the FTC wants to measure how well consumers understand “the accuracy or reliability of outputs” generated by the company’s AI tools, and calls on OpenAI to:
- Provide detailed descriptions of all complaints the startup has received about its products, including ChatGPT, making “false, misleading, disparaging or harmful” statements about people;
- Provide records related to a security incident OpenAI disclosed in March when a system flaw allowed some ChatGPT users to see payment-related information alongside customer data from other users’ chat history;
- Conduct research, tests, or surveys that assess customers’ understanding of how OpenAI’s products work, how they are advertised, and how these AI-based tools can generate disparaging statements.
Zoom out
The FTC’s focus comes at a time when the agency is looking to investigate several hallucination cases. The agency’s active mission is to communicate that existing consumer protection laws apply to AI, despite the ongoing battle of the Biden administration and Congress to put together a regulatory framework.
Last month, Senate Majority Leader Chuck Schumer (D-NY) predicted that new AI legislation is just months away as the European Union’s AI law enters the final stages of negotiations.
Vice President Kamala Harris believes we can both advance AI innovation and protect consumers, sharing the administration’s position at the White House on Wednesday, where Harris hosted a group of consumer protection and civil liberties advocates to address security and discuss AI security risks.