US regulator proposes new rules to combat AI-generated deepfakes

The US Federal Trade Commission (FTC) has proposed new regulations aimed at curbing the digital impersonation of individuals, including AI-generated deepfakes.

The commission has invited public comment on a “supplemental notice of proposed rulemaking” to protect Americans from digital impersonation. 

The new regulation on impersonation would extend protections to government and business as well, for which separate rule is being finalized by the commission. 

The FTC is involved in making various antitrust and consumer protection laws in the US that impact all aspects of commerce.

“The agency is taking this action in light of surging complaints around impersonation fraud, as well as public outcry about the harms caused to consumers and to impersonated individuals. Emerging technology—including AI-generated deepfakes—threatens to turbocharge this scourge,” the FTC said in a press release. 

The FTC said it is “committed to using all of its tools to detect, deter, and halt impersonation fraud.”

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

The FTC is also seeking comment on whether the revised rule should declare it unlawful for a firm, such as an AI platform that creates images, video, or text, to provide goods or services that they know or have reason to know is being used to harm consumers through impersonation.

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

“Our proposed expansions to the final impersonation rule would do just that, strengthening the FTC’s toolkit to address AI-enabled scams impersonating individuals,” Khan said. 

The FTC has also finalized the ‘Government and Business Impersonation Rule,’ which gives the agency stronger tools to combat scammers who impersonate businesses or government agencies. 

This rule would enable the FTC to directly seek monetary relief in federal court from scammers that use government seals or business logos when communicating with consumers by mail or online, spoof government and business emails and web addresses, including spoofing “.gov” email addresses or using lookalike email addresses or websites that rely on misspellings of a company’s name, or falsely imply government or business affiliation. 

This is particularly important given the Supreme Court’s April 2021 ruling in AMG Capital Management LLC v. FTC, which significantly limited the agency’s ability to require defendants to return money to injured consumers, as mentioned in the release.

Government and business impersonation scams have cost consumers billions of dollars in recent years, and both categories saw significant increases in reports in 2023, the FTC said. 

FTC’s final rule on government and business impersonation came after two rounds of public comment in response to an advance notice of proposed rulemaking issued in December 2021, a notice of proposed rulemaking issued in September 2022, and an informal hearing in May 2023.