US FTC says AI bias safeguards may run afoul of consumer law

The Federal Trade Commission said on Wednesday that AI companies whose chatbots produce responses reflecting ideological objectives may violate federal law. The agency issued the statement as part of a proposed policy on how the FTC will apply its authority to the sector. The FTC said companies that train chatbots to avoid responses that discriminate against specific groups of people may run afoul of the Federal Trade Act's Section 5. The law prohibits unfair or deceptive business practices. Complying with a Colorado law aimed at preventing AI-driven discrimination in employment and other consequential decisions could violate the FTC Act, the agency said. The statement was released in Washington on July 1. Reuters reported the development with a byline by Courtney Rozen and Jody Godoy dated July 1, 2026.