ChatGPT owner OpenAI is being investigated by FTC

The U.S. Federal Trade Commission is investigating ChatGPT maker OpenAI to see if the company violated consumer protection laws.

The Washington Post, which first reported the news, published FTC’s 20-page civil investigation request, similar to a subpoena, outlining the focus of the investigation. A source familiar with the matter confirmed the authenticity of the document to CNBC. The FTC declined to comment.

In the filing, the FTC said the investigation will focus on whether OpenAI “engaged in unfair or deceptive privacy or data security practices,” or “engaged in unfair or deceptive practices related to the risk of harming consumers, including reputational damage, in violation of Section 5 of the FTC Act.”

Artificial intelligence has become a hot issue in Washington, with lawmakers trying to understand whether new laws are needed to protect intellectual property and consumer data in an era of generative artificial intelligence, which requires massive data sets to learn from. The FTC and other agencies have emphasized that they already have legal authority to pursue harms caused by artificial intelligence.

The investigation is also an example of the FTC’s proactive oversight of relatively nascent technologies, in line with what Chairman Lina Khan has declared to be “forward-looking” and focused on “next-generation technologies.”

The CID asked OpenAI to list the third parties that have access to its large language models, its top 10 customers or licensors, explain how they retain and use consumer information, how they obtained information to train LLMs, etc. The document also asks how OpenAI assesses LL.M.’s risk, and how it monitors and deals with misleading or derogatory remarks about people.

CID asked OpenAI to provide information on Error disclosed by the company in March 2020 “Allows certain users to view titles in other active users’ chat histories” and “may cause 1.2% of ChatGPT Plus users to inadvertently see payment-related information while active within a specific 9-hour window.”

So far, OpenAI Chief Executive Sam Altman has largely received a warm welcome in Washington, with lawmakers praising his openness to discussing the technology and calling for regulations around it. But some AI experts warn policymakers should also be aware that the company has its own motives in articulating its regulatory vision, and urge them to listen to different voices.

Ultraman wrote on twitter “It’s very disappointing to see the FTC request start with a leak, and it doesn’t help build trust.”

“(W)e built GPT-4 on years of security research and spent over 6 months after initial training to make it safer and more consistent before release. We protect user privacy And design our systems to understand the world, not individuals,” he added. “We are transparent about the limitations of our technology, especially when we fall short.”

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