OpenAI is growing its technology and extending into more spaces in an attempt to reach a wider user base. It is also working towards transitioning into a fully for-profit organization, which is inviting legal trouble from Elon Musk. With AI advancement, there is a growing need to keep an eye on the ethical aspect of using the technology and ensure that users' privacy is intact and that no data violations occur. As the company keeps on rapidly expanding, it is facing immense pressure from authorities to adhere to laws and regulations. Recently, it has been in hot waters by Italy's authorities and facing hefty fines on account of a data collection breach.
Italy's data protection authority, Garante, is said to have levied a penalty on OpenAI of 15 million euros, which is approximately $15.58 million, after carrying out an investigation into the training process for ChatGPT. As per the authorities. OpenAI failed to be transparent with users about using personal data for training ChatGPT and lacked a legal basis for it.
The investigation also determined that there was a weak age verification process to protect young children from accessing inappropriate AI content. The investigators claimed that OpenAI also did not inform about a security breach that occurred in March 2023. Its training process also stood in violation of the European Union's General Data Protection (GDPR) law.
Other than a hefty penalty, OpenAI has also been ordered by the authorities to use different communication outlets to explain to the public how ChatGPT works so people have a better understanding of it and for the campaign to extend over the course of six months. The communication would include information regarding its data collection method, training model, rights of users, and data access. This process would allow both users and nonusers of ChatGPT to be more equipped with the workings of the models and be in a better position to exercise their rights regarding the use of personal data.
OpenAI has responded to the decision and called it disproportionate, claiming the fine exceeded the revenue made in Italy in the time period and its intention to file for an appeal. OpenAI further expressed its commitment to bringing forward AI solutions that ensure user privacy rights are respected. While OpenAI does pledge to adhere to data protection laws, the fine imposed does highlight the ongoing tensions between companies advancing in AI technology and regulatory authorities.