NEW YORK — Federal Trade Commission Chair Lina Khan warned that businesses involved in the rapid growth of artificial intelligence are not operating in a regulatory vacuum and can be held accountable by existing laws that protect against fraud.
Khan, speaking during a presentation at a Manhattan bookstore Thursday, said that while the technology is new, companies need to make sure they are operating within the law.
Khan was asked to explain the goals behind an op-ed in The New York Times on May 3, where she called for the regulation of generative AI. The technology has generated a significant amount of fear in recent weeks amid concerns it can replicate human behavior in the workplace or be used for fraudulent purposes.
The FTC is concerned about the potential for leading market incumbents to squeeze competitors of the space, Khan said during the interview with venture capitalist Bradley Tusk.
Under Khan’s leadership the FTC has been at the forefront of holding Big Tech accountable for its ability to incentivize consumer purchasing, how social media has impacted children and whether major companies have accumulated too much control over market competition.
Digital freedom advocates in March urged the FTC to investigate OpenAI regarding ChatGPT and the agency has opened an inquiry into competition in the cloud computing space.
There are interesting questions about the different inputs into AI, Khan said, and the agency needs to be vigilant in making sure competitors were not forced out from competing certain applications or models.
Data security best practices
The FTC is also making an effort to get companies to adopt best practices for how to protect customer data and respond to data breaches and malicious attacks.
In part, that includes enforcing enterprise data security practices.
The agency is working to get companies to be more proactive on the front end to protect consumer data before an incident takes place. The agency is placing greater scrutiny on individual executives to make sure they are accountable for how their companies secure customer data, Khan said.
Khan highlighted a 2022 case against Drizly, an online liquor marketplace operating as a unit of Uber, where the data of 2.5 million customers was exposed.
Khan, in response to a follow-up question from Cybersecurity Dive, said she would support a federal privacy law, however praised the work that individual states have done to protect consumer data.
“And so I’d want to make sure any federal privacy law is a floor rather than a ceiling,” Khan said.
