United States of America: Announced FTC lawsuit against Ascend Ecom for alleged false claims on income from AI-powered tools

On 7 September 2024, the Federal Trade Commission (FTC) announced a lawsuit against Ascend Ecom for alleged false claims on income from Artificial Intelligence (AI) powered tools. The FTC alleges that Ascend Ecom falsely claimed that its AI-powered tools could generate thousands of dollars in passive income for consumers through online storefronts. The defendant operated under various names since 2021 and reportedly defrauded consumers of at least USD 25 million by charging tens of thousands of dollars to set up stores on platforms such as Amazon and TikTok while promising unrealistic income gains. The FTC also claimed that consumers were left with significant financial losses, and the operators allegedly pressured them to alter negative reviews and failed to honour promised buyback guarantees. The FTC requested the court to order a halt of the scheme and place it under the control of a receiver.