Consumer Alert
Operation AI Comply: Detecting AI-infused frauds and deceptions
There’s been a lot of hype and excitement about artificial intelligence and all the amazing things it can, or one day might, do. Some companies are developing and selling AI tools, while others are flaunting the benefits of incorporating it into their existing business models. And some businesses aren’t being truthful when it comes to AI.
With the announcement of Operation AI Comply, the FTC is cracking down on AI-infused frauds and deception, including chatbots supposedly giving “legal advice,” AI software that lets people create fake online reviews, and false claims of huge earnings from AI-powered business opportunities.
Chatbots — a type of AI that creates humanlike “answers” in response to a user's prompt — might be useful when the stakes are low, like getting ideas for a new game or finding a recipe. But AI responses can be inaccurate, inadequate, misleading, or made up. The FTC just sued U.K. based DoNotPay for falsely claiming its chatbot could act like a “robot lawyer” and produce “iron clad” legal documents for people.
Verify any answers you get from a chatbot by searching online or checking with a reputable source. And don’t rely solely on a chatbot for medical, legal, or financial advice.
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AI is also fueling a flood of fake online reviews. The FTC says Rytr sells an AI tool that lets people create fake online reviews on a massive scale. When you’re reading online reviews, tread carefully.
And some companies are using AI hype and false earnings claims to trick people into investing in their business opportunities. These companies, says the FTC, include three sued by the FTC: Ascend, Ecommerce Empire Builders, and FBA Machine.
If you’re thinking about buying into a business opportunity, don’t let the AI hype cloud your judgment. Ask the seller to give you the 1-page disclosure document required by law. If the seller makes an earnings claim, they also must give you an earnings claim statement. And if the seller says anything that contradicts what’s written in their disclosure document or earnings claim statement, that’s a sign of a shady business you want to steer clear of.
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If you see fraud, scams, or bad business practices, report them to the FTC at ReportFraud.ftc.gov.
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The purpose of this blog and its comments section is to inform readers about Federal Trade Commission activity, and share information to help them avoid, report, and recover from fraud, scams, and bad business practices. Your thoughts, ideas, and concerns are welcome, and we encourage comments. But keep in mind, this is a moderated blog. We review all comments before they are posted, and we won’t post comments that don’t comply with our commenting policy. We expect commenters to treat each other and the blog writers with respect.
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September 25, 2024
Please consider making alerts available for download as a PDF so that it may be physically posted and/or shared in-person.
September 26, 2024
In reply to Please consider making… by Barry Karchner
This Consumer Alert is formatted to print, save, and download as a pdf. If you are using a tablet, laptop, or desktop computer, type CTRL and the letter P to see your print and download options.
September 25, 2024
Thank you for the information about Al.
September 25, 2024
Thanks you so very much for this information. AI is new and I appreciate being educated to its risks.
September 26, 2024
Personally I'm sick of the fake games that claim to pay out money. And the ads run 30 seconds the 10 seconds then 10 seconds and 10 more equals a whole minute of an ad that consists of nothing but other scam games.
September 25, 2024
As a former employee of a state consumer protection agency (now retired), it is refreshing and immensely helpful receiving alerts from the FTC. Being a bilingual (English and Spanish) consumer, does give the FTC efforts even more value for a broader audience. Kudos for embarking in such a valuable initiative to protect consumers, since the risks have exponentially increased affecting consumers, particularly in the financial world. Thank you!
September 25, 2024
Great consumer information.
September 26, 2024
I appreciate your thoughtfulness of consumers, such as myself, in putting out this valuable information about AI usage.
September 26, 2024
Thank you
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