FTC rule finalized – governments and business protected from AI impersonation scams

The Federal Trade Commission has approved a regulation prohibiting impersonating a government agency or commercial entity, and it is pursuing action against the use of artificial intelligence in impersonation fraud schemes.

The rule, which the commission finalized on Thursday, gives the FTC more powerful instruments to fight impersonation schemes. With the new rule, the Federal Trade Commission (FTC) can now bring direct federal court lawsuits against con artists to try and make them refund the money they took from a corporate or government impersonation scheme. Further, the FTC proposes extending the new rule that safeguards governments and corporations, adding a civil penalty for employing AI to impersonate people. According to a news release from the FTC, the extension was made in response to comments received during the public comment period for the government and business impersonation rule.

The new rules give the FTC more powerful instruments to fight impersonation schemes.

FTC Chair Lina M. Khan said, “Fraudsters are using AI tools to impersonate individuals with eerie precision and at a much wider scale. With voice cloning and other AI-driven scams on the rise, protecting Americans from impersonator fraud is more critical than ever.”

The commission is seeking public comment on whether it should be unlawful for AI platforms to produce material that could be used to damage consumers by impersonating companies or governmental agencies. The agency is now soliciting public comments on its proposed extension of the AI individual impersonation regulation.

Agencies in many countries seek to protect citizens against AI-generated threats.

The FTC is the latest agency trying to protect consumers from AI-generated scams. The Federal Communications Commission has banned using AI-generated voices in robocalls, giving each state’s Attorney General the power to take legal action against telemarketing scams.

According to the FTC, the final regulation regarding government and corporate impersonation will take effect 30 days after publication in the Federal Register.

FTC Chair Khan added, “As scammers find new ways to defraud consumers, including through AI-generated deepfakes, this proposal will help the agency deter fraud and secure redress for harmed consumers.”

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Deanna Ritchie

Managing Editor at ReadWrite

Deanna is an editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind, Editor in Chief for Calendar, editor at Entrepreneur media, and has over 20+ years of experience in content management and content development.