Snap CEO Evan Spiegel, joining CNBC's Power Lunch on September 17, 2024.
CNBC
pop Shares closed down 5% on Thursday after the Federal Trade Commission said it would refer a complaint against the company to the Justice Department.
The FTC's non-public complaint includes allegations that Snapchat's My AI chatbot poses “risks and harms to young users,” the commission said in a statement. The complaint stems from compliance reviews the FTC conducted with Snap after 2014 colony Regarding allegations of general deception relating to data collection by the Company.
As part of the FTC's compliance reviews of Snap, the agency said it uncovered the possibility that the company was “violating or about to violate the law.”
“The action is in the public interest,” the FTC said in its statement.
The FTC did not specify what its complaint about the My AI chatbot focused on, but the chatbot has previously come under scrutiny.
A Snap spokesperson responded to the FTC's allegations in a statement to CNBC.
“Unfortunately, on the last day of this administration, a divided FTC decided to vote on a proposed complaint that takes none of these efforts into account, is based on inaccurate information, and lacks concrete evidence,” a Snap spokesperson said. “It also fails to identify any tangible harm and is subject to serious First Amendment concerns.”
The spokesperson added that while the company shares the FTC's “focus on ensuring thoughtful development of generative AI,” Snap believes “the complaint would stifle innovation and competition in a vital and growing sector of the economy.”
pop For the first time My AI chatbot in 2023. It is Supported Through OpenAI and Google's large language models, giving it the ability to answer user questions and provide tips and suggestions similar to ChatGPT and other AI-powered chat tools.
The chatbot has been flagged for providing problematic responses. In one case, while speaking with a reporter who was pretending to be a teenager, a chatbot responded by explaining how to mask the smell of alcohol and marijuana, Washington Post I mentioned In 2023. At the time of the initial release of the chatbot, Snap He said My AI, like other AI chatbots, is “prone to hallucinations and can be tricked into saying anything. Please be aware of its many shortcomings and apologize in advance!”
In October 2013, the UK Information Commissioner's Office Issued Initial enforcement notice against Snap, claim The company's AI risk assessment “did not adequately assess the data protection risks posed by generative AI technology, particularly for children”.
Although the FTC said it voted during a closed meeting to issue a public statement about its case against Snap and its subsequent referral to the Justice Department, it noted the absence of FTC Commissioners Melissa Holyoake and Andrew Ferguson.
The Federal Trade Commission also pointed out A Contrary statement Ferguson, President-elect Donald Trump His name is in December To replace Lina Khan as the next chair of the Federal Trade Commission.
Ferguson noted that this type of referral “is not disclosed unless the complaint is submitted to the court by the administration or the commission.”
“I did not participate in the farcical closed session in which this matter was approved,” he wrote.
Ferguson added that he opposes the FTC's complaint against Snap, but that he cannot “release a detailed analysis of its many problems” because the case is not public. Ferguson wrote that the complaint's interpretations of the FTC Act are “erroneous” and that they “directly conflict with First Amendment guarantees.”
If the Justice Department files the complaint, Ferguson said he “will issue a more detailed statement about this affront to the Constitution and the rule of law.”
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