Emphasizing that utilizing artificial intelligence to mislead or defraud consumers is illegal, FTC Chair Lina Khan said there is no AI exception from current rules. This campaign aims to guard honest companies and consumers against unethical artificial intelligence methods.

Under examination among the companies is DoNotPay, which bills itself as the “world’s first robot lawyer.” The FTC claimed the company fell short of its promises of offering legitimate legal services, including producing legal documentation and managing disputes. The government said that DoNotPay had not used legal advice or sufficiently tested its artificial intelligence bot. DoNotPay agreed to pay $193,000 and let clients know about the restrictions of its offerings, therefore resolving the matter.

Other companies included in the FTC’s action are Ascend Ecom, accused of defrauding consumers out of over $25 million by promising passive income through AI; E-commerce Empire Builders (EEB), which falsely claimed to help users create profitable AI-powered e-commerce businesses; Rytr, which allegedly sold an AI-powered writing tool generating misleading consumer reviews, so contributing to false information online; and FBA Machine, a scheme promising income through AI-powered online stores, reportedly costing consumers over $15.9 million. This matter is still under progress.

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