Andrew Smith, the Director of the FTC’s Bureau of Consumer Protection released a blog posting on businesses’ use of AI and algorithms that offers insights into how the Bureau will look at AI through its consumer protection mission.  Smith said that “the use of AI tools should be transparent, explainable, fair, and empirically sound, while fostering accountability. We believe that our experience, as well as existing laws, can offer important lessons about how companies can manage the consumer protection risks of AI and algorithms.”

The FTC blog advised businesses to be transparent, explain their decision to the consumer, ensure that their decisions are fair, ensure that their data and models are robust and empirically sound, and hold themselves accountable for compliance, ethics, fairness and nondiscrimination.

The blog noted the FTC’s thinking on AI has been influenced in part by its 2016 report, Big Data: A Tool for Inclusion or Exclusion?, which advised companies using big data analytics and machine learning to reduce the opportunity for bias. Most recently, we held a hearing in November 2018 to explore AI, algorithms, and predictive analytics.