Marketer that claimed it could tap devices for ad targeting will pay $880K settlement

CMG Local Solutions advertised an “Active Listening” service claiming devices were listening and that “voice data” could help advertisers target ads to specific people. The claims suggested real-time detection of relevant conversations via smartphones, smart TVs, and other devices. The company did not explain how it could remotely extract enough computing and networking power to clandestinely capture and transmit voice recordings or gain access beyond what law enforcement can do without a warrant. The FTC announced CMG would pay $880,000 to settle allegations that CMG falsely claimed consumers opted into AI-powered localized ad targeting based on conversations from smart devices. The FTC stated the service did not listen to conversations or use voice data and did not accurately place ads in desired locations, instead reselling email lists obtained from other data brokers.

"The company advertised a service called Active Listening on a website that said, "It's true. Your devices are listening to you" and claimed it could use "voice data" to help advertisers target ads to specific people."

"The idea of a marketing firm using AI to "detect relevant conversations via smartphones, smart TVs, and other devices" in real time-according to a since-deleted CMG blog post from November 2023-has raised alarms. But it was also apparent that CMG's claims were unlikely to be true."

"The company never explained how it could remotely extract enough computing and networking power from users' devices to clandestinely capture and send voice recordings in "real-time" or obtain more intimate access to people's homes than law enforcement can without a warrant."

"According to the [FTC-filed] complaints, this service did not, in fact, listen in on consumers' conversations or use voice data at all-nor did the service accurately place ads in customers' desired locations. Instead, the service the companies provided consisted of reselling-at a significant markup-email lists obtained from other data brokers."

Read at Ars Technica