WASHINGTON, D.C. — The Federal Trade Commission (FTC) has issued a proposed order against Workado, LLC, targeting the company’s advertising of its AI Content Detector. The FTC alleges Workado misrepresented the accuracy of its product, which claims to identify whether written content was created by artificial intelligence or a human author. This settlement aims to address the broader issue of deceptive claims in the evolving AI technology sector.
According to the FTC’s administrative complaint, Workado promoted its AI Content Detector as being “98 percent” accurate in determining the origins of written text. However, independent tests revealed the product’s performance fell drastically short of this claim, achieving an accuracy rate of only 53 percent for general-purpose content. The FTC alleges that such misrepresentations constitute violations of the FTC Act.
FTC Bureau of Consumer Protection Director Chris Mufarrige emphasized the seriousness of the allegations, stating, “Consumers trusted Workado’s AI Content Detector to help them decipher whether AI was behind a piece of writing, but the product did no better than a coin toss. Misleading claims about AI undermine competition by making it harder for legitimate providers of AI-related products to reach consumers.”
Details of the Allegations
Workado marketed its AI Content Detector as a sophisticated tool, claiming it was trained using diverse sources of material, including blog posts and entries from Wikipedia, to ensure high accuracy for general consumers. However, the FTC contends that the company’s AI model was narrowly trained to analyze academic content, significantly limiting its effectiveness and applicability for broader use cases.
The false representation of the product’s capabilities led to the Commission accusing Workado of misleading advertising practices and failing to substantiate its claims with competent and reliable evidence. The settlement is aimed at preventing Workado from making similar unsupported claims in the future while reinforcing transparency in AI product advertising.
Requirements of the Proposed Order
The proposed order, which remains subject to public comment before becoming final, would impose several obligations on Workado, including:
- Prohibition on Misleading Claims: Workado must refrain from making any representations about the effectiveness of its products unless those claims are substantiated by competent and reliable evidence.
- Retention of Evidence: The company must retain documentation supporting any claims made about the efficacy of its AI products.
- Consumer Notification: Workado will be required to email eligible consumers to inform them of the consent order and settlement terms.
- Compliance Reporting: The company must submit annual compliance reports to the FTC over a three-year period, with the first report due one year after the order’s enactment.
The Commission unanimously voted 3-0 to issue the administrative complaint and accept the consent agreement. The FTC will publish details of the proposed settlement in the Federal Register and invite public comments for 30 days before determining whether to finalize the order.
Implications for AI Product Advertising
The FTC’s actions against Workado aim to ensure that companies in the rapidly growing AI sector adhere to truth-in-advertising standards. This case underscores the importance of substantiating claims with credible evidence, particularly as AI technologies increasingly influence consumer decisions across industries. If the proposed order becomes final, it could serve as a precedent for stricter regulation and scrutiny of AI product advertising practices going forward.
By holding companies accountable for misleading claims, the FTC aims to safeguard consumer trust and foster a competitive environment where legitimate AI product developers can thrive. With public input and rigorous oversight, this effort signals a critical step toward greater transparency and reliability in the marketing of AI-powered technologies.
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