The FTC's War on AI: How America's Trade Commission Became the Privacy Sheriff Nobody Expected

A woman walks into a Rite Aid in Philadelphia. She picks up some items, pays, and leaves. On her way out, a security guard stops her. The facial recognition system flagged her — it says she matches someone in their shoplifter database. She doesn't. She never shoplifted from Rite Aid. This happened thousands of times across Rite Aid's stores between 2012 and 2020. The system had a "rampant" false positive rate, and according to the FTC's complaint, it disproportionately flagged Black and Latino customers. People were detained, humiliated, accused of crimes they didn't commit — by an algorithm that nobody told them was watching. In December 2023, the FTC banned Rite Aid from using facial recognition for surveillance for five years. Required them to delete every facial image and every model trained on them. First-ever FTC ban on a facial recognition technology. That case is a preview of where AI regulation in America is heading. The FTC isn't waiting for Congress to pass comprehensive AI