Other parts of the world have accelerated legislation aimed at protecting consumers from advanced artificial intelligence tools, such as chatbots that can replicate human tasks and facial biometric surveillance in public spaces. I’m here.
But in the US, federal legislation has stalled, leaving the job of regulating Open AI’s ChatGPT and other generative AI tools to local governments. The extent of consumer protection available in this country at this time depends on where the consumer lives.
By the end of 2023, six states have or will have laws banning companies from using AI to discriminate or deceive consumers or job seekers: California, Colorado and Connecticut. , Illinois, Maryland, and Virginia.
New York City also joined efforts to pass ordinances regulating the use of AI in the hiring process.
“We are at a complete tipping point,” Gori Mahadavi, a data privacy attorney at Brian Cave Leighton Peisner, told Yahoo Finance. “Across the enterprise he has massive adoption of AI tools.”
On Thursday, the European Union also took a big step towards passing legislation regulating AI tools, including Chat GPT. The country’s lawmakers have agreed to strengthen a bill that includes a ban on facial recognition in public spaces and greater transparency in programming generative AI.
state guardrail
In the United States, states with laws in place are aiming for similar protections, Mahadavi said. California, Colorado, Connecticut, and Virginia ban AI “profiling” without consumer consent. So does New York City.
This practice includes collecting or sharing personal data, such as work, health, or financial records, and relying on computer algorithms to evaluate the data and make decisions with legal consequences, such as granting or denying loans or insurance coverage. down. Or housing.
As long as AI tools make automated decisions in these categories, companies will need to explain to customers the logic used to program the AI’s decision-making capabilities, Mahadavi explained.
The law also requires companies using tools to provide consumers with an opt-out, and companies to undergo risk assessments that detail the benefits and risks of AI tools to consumers.
Illinois and New York City laws have different guardrails on how employers use AI tools, preventing employers from collecting job applicants’ personal data to make hiring decisions.
Maryland prohibits employers from using facial recognition technology to identify job applicants unless the candidate consents.
California law provides the state’s consumers with the strongest protections. In addition to blocking profiling, the state makes it illegal to use online bots to facilitate the sale of goods and services to individuals within its borders.
Exceptions to the law allow the use of bots as long as AI tools are clearly disclosed, and similarly prohibit the use of bots for the purpose of influencing election votes.
“There is no universal standard”
Mahadavi expects companies to face compliance challenges as these laws come into force.
“Compliance risks are always increased when dealing with a patchwork of state laws, as there is no universal standard for companies to tie their compliance programs to,” she says.
The industries most affected at the moment are the housing, employment and insurance sectors, she added.
Mahadavi explained that California is best equipped to enforce the law because the state allocates enforcement resources. Whether other states have the power to enforce the law remains to be seen.
“We know that California has its own dedicated consumer privacy agency with its own budget and is currently ramping up staff,” she said. “For this reason, it is expected that crackdowns will be carried out all at once in July, the date of enforcement.”
Alexis Keenan is a legal reporter at Yahoo Finance. Follow Alexis on Twitter @alexiskweed.
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