Washington: Artificial intelligence (AI)-powered shopping assistants are increasingly being used to help consumers make informed purchasing decisions, but a new study has raised concerns over how these technologies are being deployed. The report claims that AI shopping assistants developed by Amazon and Walmart are capable of detecting misleading “Made in USA” claims on products, yet the companies are allegedly not using the technology to actively flag or act against such deceptive listings.
The study was released by a think tank led by former U.S. Federal Trade Commission (FTC) Chair Lina Khan. According to the report, Amazon’s Alexa for Shopping and Walmart’s Sparky can identify inconsistencies between explicit “Made in USA” claims and contradictory information contained in product descriptions. Despite having this capability, the AI systems are reportedly not configured to automatically flag or remove suspicious listings.
Researchers also questioned the AI chatbots about why the companies were not taking stronger action against misleading product labels. According to the study, Walmart’s AI assistant responded that enforcement of “Made in USA” regulations is generally directed at manufacturers rather than retailers. However, the report argues that this reflects a business decision rather than a legal justification.
Responding to the findings, Amazon said that country-of-origin information is displayed on product pages whenever available and that the company is continuously working to make such information more accessible to customers. Walmart had not issued an official response at the time the report was published.
The report is the first publication from Columbia Law School’s Center for Law and the Economy, established after Lina Khan returned to the university following the completion of her tenure at the FTC. The study argues that while AI technologies continue to become more advanced and capable, the way they are deployed ultimately depends on corporate business priorities.
According to the report, companies may have little incentive to act against misleading product claims unless those claims create direct financial, regulatory or reputational consequences. Researchers noted that when questioned, Amazon’s AI assistant also suggested that although the harm caused to genuine U.S. manufacturers is real, there is limited motivation to intervene unless it results in tangible costs for the company.
Under FTC regulations, a product may be labelled “Made in USA” only if it is “all or virtually all” manufactured in the United States. Last year, the FTC urged both Amazon and Walmart to strengthen oversight of third-party sellers making such claims and to take stronger action against misleading country-of-origin labels. Both companies also require sellers to provide accurate product information under their marketplace policies.
Experts believe that despite the rapid advancement of AI capabilities, technology alone cannot ensure consumer protection. They argue that unless companies prioritize regulatory compliance and transparency, AI systems may continue identifying potential violations without triggering meaningful enforcement. According to them, stronger regulatory oversight and clearer corporate accountability will become increasingly important as AI assumes a larger role in online commerce.
The study comes at a time when global e-commerce companies are investing heavily in AI-powered tools to improve customer experience, personalize shopping and drive sales. It has also reignited debate over whether AI should be used solely to enhance commercial performance or whether it should play an equally significant role in protecting consumers and promoting transparency across digital marketplaces.
