Cox Media Group settles FTC claims over false AI advertising

Cox Media Group (CMG), MindSift LLC, and 1010 Digital Works LLC have reached a settlement with the Federal Trade Commission (FTC) regarding allegations of false advertising. The companies were accused of marketing an ‘Active Listening’ service that claimed to use artificial intelligence to listen to consumer conversations via smart devices to deliver targeted advertisements.

Regulators found that the service did not actually use voice data or proprietary algorithms to detect real-time conversations. Instead, the companies allegedly provided email lists purchased from data brokers at a significant markup. Furthermore, the FTC determined that the companies misrepresented consumer consent, falsely claiming that users had opted into voice monitoring by simply accepting standard app terms of service.

Under the finalized orders, CMG will pay $880,000, while MindSift and 1010 Digital Works will each pay $25,000. The funds are intended for redress to affected customers. The settlement also prohibits the defendants from making future misrepresentations regarding the features of their marketing services, the use of voice data, or their geographic targeting capabilities.