Senators urge FTC to investigate Amazon, Walmart chatbots over 'made in USA' claims

by@Reuters

Summary

Two U.S. senators, Tammy Baldwin and Rick Scott, have urged the Federal Trade Commission (FTC) to investigate Amazon and Walmart over their AI shopping chatbots, which they claim may suppress "made in the USA" products and fail to identify falsely labeled goods. The senators referenced a study indicating that chatbots like Amazon's Alexa for Shopping and Walmart's Sparky AI prioritize overseas products while lacking mechanisms to filter or flag authentic American-made items. This call for investigation follows prior FTC letters sent to both retailers last year, emphasizing the need for accurate country-of-origin claims from third-party sellers. The study also found that these AI systems can detect false "made in USA" labels but that retailers are not utilizing this capability effectively.

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Analysis

Amazon: Amazon is a major e-commerce and technology company that operates online retail platforms and AI-powered services such as Alexa. Its Alexa for Shopping chatbot is the focus of a Senate letter to the FTC alleging suppression of "made in USA" product information and failure to address fraudulent labels. Amazon responded that the suggestion of intentional withholding is wrong and that it directs users asking about country of origin to product detail pages. Walmart: Walmart is a large retail corporation running physical stores and online platforms with AI shopping tools including Sparky. Its Sparky AI assistant is cited in the senators' complaint for potentially misleading consumers on American-made goods and not flagging suspicious claims. The company has not yet responded to the Reuters inquiry about the letter. Rick Scott: Rick Scott is a Republican US Senator from Florida. He joined Senator Baldwin in sending the letter criticizing the retailers' AI shopping assistants for potentially undermining US product promotion and misleading buyers. The senators emphasize findings that the chatbots may prioritize overseas sellers. Tammy Baldwin: Tammy Baldwin is a Democratic US Senator from Wisconsin serving on the Senate Commerce Committee. She co-authored the letter to the FTC urging an investigation into Amazon and Walmart chatbots over "made in USA" issues. The letter draws on a think tank study and calls for stronger enforcement to support American manufacturing. AI Detection: The study found that AI shopping assistants can often identify false "made in USA" labels but retailers are not applying this capability. Senator Request: Senators Baldwin and Scott are encouraging the FTC to pursue additional enforcement measures after reviewing the think tank study on AI chatbots. FTC Prior Action: The FTC sent letters last year to Amazon and Walmart urging them to address third-party sellers' fraudulent "made in USA" claims.

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