“There will be fewer, if any, enforcement actions about how companies are deploying AI,” says former FTC attorney Leah Frazier.
Most Americans encounter the Federal Trade Commission only if they’ve been scammed: It handles identity theft, fraud, and stolen data. During the Biden administration, the agency went after AI companies for scamming customers with deceptive advertising or harming people by selling irresponsible technologies. With yesterday’s announcement of President Trump’s AI Action Plan, that era may now be over.
In the final months of the Biden administration under chair Lina Khan, the FTC levied a series of high-profile fines and actions against AI companies for overhyping their technology and bending the truth—or in some cases making claims that were entirely false.
It found that the security giant Evolv lied about the accuracy of its AI-powered security checkpoints, which are used in stadiums and schools but failed to catch a seven-inch knife that was ultimately used to stab a student. It went after the facial recognition company Intellivision, saying the company made unfounded claims that its tools operated without gender or racial bias. It fined startups promising bogus “AI lawyer” services and one that sold fake product reviews generated with AI.
