FTC Warns About Changing Terms Of Service Or Privacy Policy To Train AI On Previously Collected Data

In recent guidance, AI (and other) Companies: Quietly Changing Your Terms of Service Could Be Unfair or Deceptive ("Guidance"), the FTC warned:

It may be unfair or deceptive for a company to adopt more permissive data practices—for example, to start sharing consumers' data with third parties or using that data for AI training—and to only inform consumers of this change through a surreptitious, retroactive amendment to its terms of service or privacy policy.

The FTC further warns that market participants should be on notice that any firm that reneges on its user privacy commitments risks running afoul of the law. Simply put, according to the FTC guidance a business that collects user data based on one set of privacy commitments cannot then unilaterally renege on those commitments after collecting users' data.