The Federal Trade Commission (FTC) is taking a firm stance against companies that surreptitiously modify their privacy policies to exploit user data for the enhancement of artificial intelligence (AI) tools. In a recent blog post, the FTC emphasized its commitment to enforcing terms of service and pursuing entities that quietly alter policies to access more data for AI purposes. The agency likened data to the “new oil,” noting the voracious appetite AI companies have for vast amounts of information collected by businesses.
FTC highlighted the potential conflict of interest faced by companies seeking to mine their user base for existing data to fuel AI models, even in violation of established privacy and security policies. Despite the presence of such policies, firms may be tempted to tap into user data to bolster their AI products, driven by powerful business incentives. The agency warned that any breach of user privacy commitments could lead companies to run afoul of the law, emphasizing the need for market participants to uphold their obligations.
In particular, the FTC signaled its intent to target companies adopting more permissive data practices, such as sharing consumer data with third parties or using it for AI training, without adequately informing consumers. The agency expressed readiness to pursue cases against firms that retroactively amend terms of service or privacy policies to facilitate these changes, without transparently notifying users. Notably, the FTC has previously taken action against companies for similar deceptive practices, reinforcing its commitment to holding entities accountable for unfair or deceptive conduct regarding user data.
Ultimately, the FTC’s warning serves as a reminder to companies of the importance of maintaining transparency and honoring privacy commitments in the rapidly evolving landscape of AI technology. By pledging to enforce stringent measures against deceptive practices, the agency aims to protect consumers from potential privacy breaches while promoting trust and accountability in the digital ecosystem.
