While the Federal Trade Commission (FTC) has already provided past guidance to businesses about use of artificial intelligence (AI), [1] its most recent press release comes across as more of a warning than guidance. In the latest statement, the FTC advises businesses to “Keep Your AI Claims in Check,” and ends with a pithy statement that “you don’t need a machine to predict what the FTC might do when [AI] claims are unsupported.”
For the purposes of this latest statement, the FTC acknowledges that there are many possible definitions of AI, but states that the term most often refers to technological tools and techniques that use computation to perform tasks. The FTC expresses concern that businesses are using “AI” as an unfair and deceptive marketing term due to mainstream buzz and interest in AI, even when their own product or service may not actually involve AI.
The FTC lists four main considerations:
- Do not exaggerate. Businesses should not claim a product or service can do something beyond its current capability. The FTC states that claims are deceptive if they lack scientific support or if they apply only to certain types of users or under certain conditions.
- Do not over-promise. Comparative claims should have adequate proof and support. According to the FTC, claims that an AI product does something better than a non-AI product are not appropriate, absent proof to support that claim.
- Be aware of risks. Consider disclosures about reasonably foreseeable risks and impacts of AI products before the product is put onto the market. Notably, the FTC emphasizes that businesses may not disclaim responsibility by stating that technology is a “black box” that cannot be understood or tested.
- Consider whether a product or service actually uses AI. If a product or service is not actually AI-enabled, then do not say it is an AI-powered product or service. The FTC also notes that merely using an AI tool in the development process is not the same as the product utilizing AI itself.
As previously noted in its 2022 report to Congress, the FTC has addressed AI repeatedly, has hired advisors on AI, and has held several public events focused on AI issues, such as dark patterns, algorithmic bias, and a hearing on consumer protection issues with algorithms and AI. It does not appear that the FTC’s interest in AI claims will be diminishing anytime soon.
[1] The FTC’s guidance for companies includes its April 2021 post, Aiming for truth, fairness, and equity in your company’s use of AI | Federal Trade Commission (ftc.gov).
