FTC’s Rite Aid Action Puts AI Facial Recognition Users on Notice

The Federal Trade Commission sent a warning to companies using AI systems with its move prohibiting Rite Aid Corp. from using facial recognition surveillance after the drugstore chain misidentified customers with the technology and falsely accused them of shoplifting.

Experts say the settlement, outlined in a proposed stipulated order filed with the FTC’s complaint Tuesday in the US District Court for the Eastern District of Pennsylvania, marks a new plateau of artificial intelligence-related developments from the consumer protection agency.

“I want industry to understand that this Order is a baseline for what a comprehensive algorithmic fairness program ...