US FTC opens investigation against ChatGPT maker OpenAI for breaking consumer protection laws

Both FTC and OpenAI did not respond immediately as per Reuters.

The United States Federal Trade Commission has opened an investigation against OpenAI, the maker of ChatGPT.

As per the report by Washington Post on Thursday, FTC has alleged that OpenAI has run afoul of consumer protection laws by putting personal reputations and data at risk.

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The latest move has marked the strongest regulatory threat against the Microsoft backed startup that started popular AI ChatGPT enthralling consumers and businesses while raising concerns about its potential risks.

FTC this week served a 20-page demand to OpenAI addressing the risks related to its AI model. As per Washington Post, The agency is investigating whether the company engaged in unfair or deceptive practices that resulted in “reputational harm” to consumers.

Both FTC and OpenAI did not respond immediately as per Reuters.

As companies are racing against time to develop more powerful Artificial Intelligence, there has been a growth in regulatory scrutiny that could upend the manner in which societies and businesses operate.

Regulators across the world are aiming to apply various rules from copyright and data privacy to two key issues: the data fed into models and the content they produce, Reuters reported in May.

United States Senator Chuck Schumer has called for “comprehensive legislation” to advance and ensure safeguards on AI and will hold a series of forums later this year.

OpenAI ran in trouble with the Italian authorities in March and ChatGPT was taken offline by the regulators over accusations that OpenAI violated the European Union’s GDPR – a wide-ranging privacy regime enacted in 2018.