3 Ways ChatGPT Might Be Hurting You Financially, According to FTC Probe
Written by
Yaël Bizouati-Kennedy
Edited by
Chris Cluff
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The Federal Trade Commission (FTC) is probing OpenAI — the company behind ChatGPT — for possible violations of consumer protection law. The move comes as regulators are ramping up their efforts to come up with a framework to protect consumers.
According to a leaked document related to the probe, first obtained by The Washington Post, the agency is looking to determine if the company “engaged in unfair or deceptive or engaged in unfair or deceptive practices relating to risks of harm to consumers, including reputational harm, in violation of Section 5 of the FTC Act.”
Following the news, on July 23 OpenAI CEO Sam Altman tweeted: “It is very disappointing to see the FTC’s request start with a leak and does not help build trust. That said, it’s super important to us that our technology is safe and pro-consumer, and we are confident we follow the law. Of course we will work with the FTC.”
He further tweeted: “We built GPT-4 on top of years of safety research and spent 6+ months after we finished initial training making it safer and more aligned before releasing it. We protect user privacy and design our systems to learn about the world, not private individuals.”
The FTC’s civil investigative demand (CID) includes many requests from OpenAI, and here are the possible financial effects the FTC is looking into.
Misleading Statements About People
The FTC intends to look into reputational risks that could hurt companies or personal brands and, in turn, earning potential.
The agency asked that the company details the steps taken to “mitigate the risks that your large language model products could generate statements about real individuals that are false, misleading, or disparaging,” according to the CID.
Payment Data Possibly Leaked
The CID also requests information about a bug the company disclosed in March, which “caused the unintentional visibility of payment-related information of 1.2% of the ChatGPT Plus subscribers who were active during a specific nine-hour window.”
“In the hours before we took ChatGPT offline on Monday, it was possible for some users to see another active user’s first and last name, email address, payment address, credit card type and the last four digits (only) of a credit card number, and credit card expiration date. Full credit card numbers were not exposed at any time,” OpenAI stated in a March blog post.
Discrimination
The FTC has repeatedly voiced its concerns about potential discrimination. In April, several federal agencies — the Consumer Financial Protection Bureau, the Department of Justice, the Equal Employment Opportunity Commission and the FTC — came together to issue a statement and guidelines.
“There is no exemption in our nation’s civil rights laws for new technologies that engage in unlawful discrimination,” said CFPB director Rohit Chopra in prepared remarks.
The discrimination, they argued, can for example be found in housing, employment or lending.
Phil Siegel, founder of Center for Advanced Preparedness and Threat Response Simulation (CAPTRS), noted that unfair hiring practices could cost someone an opportunity for a job.
Seigel also added that additional issues include any type of so-called hallucination (“the propensity to generate responses that are false or unjustified,” per the FTC) by the large language model — which could cause personal harm in several areas including health care, reputation and financial services.
“Finally, the model may be trained on old data so personal information may not only be misused but may be inaccurate and/or not up to date,” added Seigel.
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