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On April 25, 2023, officials from the Federal Trade Commission, Consumer Financial Protection Bureau (“CFPB”), Department of Justice’s Civil Rights Division (“DOJCRD”) and the Equal Employment Opportunity Commission (“EEOC”) released a Joint Statement on Enforcement Efforts against Discrimination and Bias in Automated Systems (“Statement”), also sometimes referred to as “artificial intelligence” (“AI”).

The Statement, issued by Rohit Chopra (Director, CFPB), Kristen Clarke (Assistant Attorney General, DOJCRD), Charlotte Burrows (Chair, EEOC) and Lina Khan (Chair, FTC), outlines the commitment of the four agencies to enforce the laws within their respective purviews to protect against bias and other harms in automated systems. The Statement focuses on “automated systems” software and algorithmic processes, including AI, that are used to automate workflows and help people complete tasks or make decisions, including about access to employment opportunities, housing credit opportunities and other goods and services.

The Statement highlighted the following examples of the agencies’ positions relating to automated systems.

  • The FTC, which protects consumers from unfair and deceptive business practices and unfair competition (e.g., under Section 5 of the FTC Act, the Fair Credit Reporting Act, and the Equal Credit Opportunity Act), issued a report to Congress in 2022 evaluating the use of AI in combatting online harms and outlining concerns that AI tools can be inaccurate, biased and incentivize invasive commercial surveillance. The FTC warned in February and March 2023 that discriminatory impacts, unsubstantiated statements and failures to assess and mitigate risks in connection with AI tools may violate the FTC Act. The FTC has required companies in recent years to destroy algorithms (In re Everalbum, Inc.) and other work product (In re Weight Watchers/WW) that were trained on data that should not have been collected.
  • The CFPB, which protects the financial marketplace from unfair, deceptive, or abusive acts or practices and from discrimination, published a circular in May 2022 indicating that financial consumer protection laws, including requirements to provide notice of adverse actions on credit applications, apply regardless of the technology used, and that complex algorithms should be avoided when using them would mean that creditors cannot provide the required reasons for adverse actions.
  • The DOJCRD, which enforces constitutional provisions and federal statutes prohibiting discrimination, filed a statement of interest in January 2023 in a pending lawsuit in the U.S. District Court for the District of Massachusetts explaining how the Fair Housing Act, which prohibits discrimination in housing on the basis of race, color, religion, sex, familial status, national origin and disability, applies to algorithm-based tenant screening services.
  • The EEOC, which enforces federal laws prohibiting discrimination against applicants or employees due to a person’s race, color, religion, sex, national origin, age, disability or genetic information, issued a technical assistant document in May 2022 explaining how the Americans with Disabilities Act applies to the use of AI to make employment-related decisions about job applicants and employees.

The Statement indicated that potential bias in automated systems may stem from skewed underlying datasets, opaque “black box” systems that obscure biases and reliance on flawed assumptions about users and uses at the system design phase.