FTC’s Operation AI Comply Accuses Ascend Ecom of Misleading Users

Initiated by the U.S. Federal Trade Commission (FTC), Operation AI Comply investigated several artificial intelligence developers that reportedly utilized the technology to mislead users. The FTC has since filed a lawsuit against the companies, including the business opportunity scheme Ascend Ecom.

Ascend Ecom, operated by William Basta and Kenneth Leung, reportedly promotes AI tools that can help users earn a substantial passive income. The AI software can create online storefronts on websites like Walmart, Amazon, and Etsy.

According to the FTC, Ascend’s advertising promised a “five-figure monthly income” within two years of buying the “cutting edge” AI tools. Yet, after spending thousands of dollars for access, the majority of customers never saw any profit. Instead, customers were left with credit card bills and empty bank accounts.

The FTC received numerous customer complaints against the company, including claims that Ascend pressured users to remove or change negative reviews. The company also reportedly failed to honor a “guaranteed buyback” if a customer left a bad review.

Ascend has swindled users out of about $25 million, per the FTC’s lawsuit. A federal court has since ordered the company to stop selling the AI tool.

Why Did the FTC Start Operation AI Comply?

As AI creeps into our everyday lives, some companies are reportedly taking advantage. As such, the FTC’s Operation AI Comply began looking into AI-powered software that can potentially defraud a user.

The regulatory agency has specifically targeted AI chatbots that provide legal advice, tools that create fake online reviews, and software that claims people can quickly earn money. In addition to Ascend, the FTC named four other companies in the investigation: DoNotPay, Rytr, Ecommerce Empire Builders, and FBA Machine — all of which reportedly used AI to either intentionally or inadvertently deceive users.

“Using AI tools to trick, mislead, or defraud people is illegal,” said FTC Chair Lina M. Khan. “The FTC’s enforcement actions make clear that there is no AI exemption from the laws on the books.”

While current AI platforms can be useful for recipe or vacation ideas, they are also prone to mistakes that could adversely affect a person’s life. If asking a chatbot for medical, financial, or legal advice, the answers received should be verified through a reputable third-party source.