U.S. senators seek FTC probe into Amazon, Walmart chatbot handling of made in U.S.A. labels

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Senators seek FTC probe on chatbots

Highlights

Senators Tammy Baldwin and Rick Scott urged the FTC to investigate Amazon's Alexa for Shopping and Walmart's Sparky AI assistants for potentially suppressing made in U.S.A. product information.
A think tank study found AI assistants can identify false made in U.S.A. claims but noted Amazon and Walmart are not using this capability to police listings more aggressively.
The senators' letter follows prior FTC warnings to Amazon and Walmart about stricter enforcement on accurate made in U.S.A. labeling, amid ongoing antitrust action against Amazon.

Senators press for scrutiny of chatbot product filters

As reported by Reuters, citing The Wall Street Journal, senators Tammy Baldwin and Rick Scott sent a letter to the Federal Trade Commission arguing that Amazon's Alexa for Shopping and Walmart's Sparky AI assistants may undermine efforts to support American manufacturing and mislead shoppers about product origin.

The lawmakers cited a study by a think tank led by former FTC Chair Lina Khan that says the chatbots suppress information about American-made goods while providing information on items produced in countries including China. In the letter, the senators said Alexa responded to questions about the lack of a made in U.S.A. filter by saying such a tool would redirect significant sales away from overseas manufacturers.

The study also says AI shopping assistants can often identify false made in U.S.A. claims, but the retailers are not using that capability to police listings more aggressively. Researchers also found that Walmart's Sparky, when asked why it did not flag suspicious claims, referred to limited FTC enforcement against retailers, which the study described as a business calculation rather than a legal justification.

Regulatory pressure builds on online retail claims

Amazon, Walmart and the FTC did not immediately respond to Reuters requests for comment. In their letter, the senators said they support efforts to strengthen American manufacturing and small businesses through made in U.S.A. labeling while ensuring consumers get accurate information about where products are made.

The lawmakers said that after a robust investigation, the commission should consider additional enforcement measures to deter such conduct. The FTC already signaled concern last year when it sent letters to Amazon and Walmart urging them to crack down on third-party sellers' made in U.S.A. claims and pointing to company policies requiring accurate seller disclosures.

The latest complaint adds to broader scrutiny around Amazon's market practices. Khan, while leading the FTC, sued Amazon on allegations that it maintains illegal online retail monopolies, and that case remains ongoing.

Our earlier article on the push for federal AI safety guardrails in Washington outlined how lawmakers are trying to move quickly on baseline standards for rapidly advancing AI. We noted Senator Mark Warner’s call to pass an initial safety bill before the next Congress, amid debate over balancing risk mitigation for critical infrastructure with concerns that new rules could slow private-sector growth.

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