Because the Turing Test is not enough…
[WARNING! I AM HUMAN, AND CAN MAKE ERRORS TOO!]
As businesses integrate artificial intelligence in their operations (including goodcounsel, which we’ve written about here), state legislatures are taking steps to regulate its use, particularly when there are civil rights and consumer protection implications. Much of the early focus has been on preventing algorithmic discrimination in areas such as hiring, housing, and lending. These regulations aim to ensure that automated systems do not produce biased outcomes that disproportionately affect protected groups.
Recent statutes are focused on the risks when generative AI tools interact directly with consumers. For example, Utah’s Artificial Intelligence Policy Act (as amended) requires companies to program AI chatbots to disclose to users that they are interacting with artificial intelligence (rather than a human) at the outset of an interaction, if the interaction involves (1) the collection of “sensitive personal information” such as financial, health or biometric data, and (2) the provision of personalized recommendations or advice “that could reasonably be relied upon to make significant personal decisions,” including the provision of financial, legal, medical or mental health advice. There is no private cause of action under the statute, but Utah’s Division of Consumer Protection may impose administrative fines of $2,500 per violation, in addition to injunctions, disgorgement, and other relief. California and Colorado have their own statutes addressing AI disclosures and disclaimers in consumer interactions.
This year, Alabama, Hawaii, Illinois, Maine, and Massachusetts introduced bills that would make failing to provide the required AI notification an “unfair or deceptive act or practice” (UDAP) violation under The Federal Trade Commission Act. These bills, when passed, would expose companies that use AI in consumer communications to investigation or enforcement by Attorneys General and, potentially, private actions.
Please contact us if you need help knowing which states’ AI laws apply to your business, and how to comply with them.
Categorised as: Artificial Intelligence, Regulatory alert