Latest News

ChatGPT Creator OpenAI Accused of Violating Federal Trade Law

The Center for AI and Digital Policy filed a formal complaint with the United States Department of Justice. The Federal Trade Commission has charged OpenAI, the creator of the wildly popular ChatGPT, with violating Section 5 of the FTC Act, which prohibits deceptive and unfair practices.

“The FTC has a clear responsibility to investigate and prohibit unfair and deceptive trade practices,” said Marc Rotenberg, the center’s founder and president, in a statement. “We believe the FTC should conduct a thorough investigation into OpenAI and GPT-4.”

Not by chance, the FTC updated the act last month to include language aimed at developers of artificial intelligence programs such as OpenAI. The agency warned developers not to exaggerate their capabilities, make deceptive performance claims, or promise superiority over non-AI products without adequate proof.

The Center for AI and Digital Policy was founded in 2020 as part of the Michael Dukakis Institute for Leadership and Innovation, which was founded by the former Massachusetts governor and failed Democratic U.S. presidential candidate, and is now a non-profit based in Washington, DC.

The FTC also advised developers to investigate potential risks and consequences before going live. “You must be aware of the reasonably foreseeable risks and impact of your AI product before releasing it to the public,” the agency wrote. “If something goes wrong—say, it fails or produces skewed results—you can’t simply blame a third-party technology developer.” And you can’t say you’re not to blame because the technology is a “black box” that you don’t understand or know how to test.”

Since 2017, the FTC has issued warnings about unethical uses of emerging technologies such as artificial intelligence and blockchain, which have grown in popularity and acceptance. Many are questioning OpenAI’s rapid dominance of the industry in light of the almost instant popularity of GPT-4, the latest iteration of ChatGPT. The Center for AI and Digital Policy has requested that the FTC investigate OpenAI to determine whether the company has followed FTC rules.

The Center’s FTC filing comes just days after several high-profile tech industry members, including Telsa and Twitter CEO Elon Musk, co-signed an open letter calling for a halt to the development of AI systems like OpenAI’s GPT-4 platform. “We urge all AI labs to immediately halt training of AI systems more powerful than GPT-4 for at least 6 months.” This pause should be public and verifiable, and it should include all key actors, according to the letter. “If such a pause cannot be implemented immediately, governments should step in and impose a moratorium.”

The Center for Artificial Intelligence and Digital Policy is not alone in requesting investigations into the rapid development of AI and the need for rules. The United Nations Educational, Scientific, and Cultural Organization (UNESCO) issued its own statement calling for a “Global Ethical Framework” on Thursday.

The 193 Member States of UNESCO’s General Conference voted in November 2021 to adopt the Recommendation on the Ethics of Artificial Intelligence, establishing a global standard for artificial intelligence ethics. This framework aims to protect and advance human rights and dignity while also serving as an ethical guide and foundation for promoting the rule of law in the digital realm.

“The world requires stronger ethical rules for artificial intelligence: this is our time’s challenge,” said UNESCO Director-General Audrey Azoulay. Decrypt reached out to the Center for AI and Digital Policy and OpenAI for comment but did not receive a response.


Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Crypto market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.