Amazon and Walmart AI Detect False ‘Made in USA’ Claims Yet Do Not Flag Them

A study by Columbia Law School’s Center for Law and the Economy, led by former FTC chair Lina Khan, found that Amazon’s Alexa for Shopping and Walmart’s Sparky AI assistants can recognise mismatches between “Made in USA” product labels and the information in listings. Despite this capability, the retailers are not using the technology to remove or flag the deceptive claims.

When questioned, Walmart’s chatbot replied, “That’s a business calculation, not a legal justification,” and Amazon’s Alexa noted that action would only occur if the harm to U.S.-made brands created a financial, regulatory, or reputational cost for the company. The FTC had previously urged both platforms to crack down on false “Made in USA” labeling, which requires products to be “all or virtually all” made in the United States.

The report highlights the tension between advanced AI tools and the commercial incentives of large retailers, suggesting a need for stronger policy enforcement.