Connecticut AG Puts Businesses on Notice Old Laws Still Apply to AI
pConnecticut Attorney General William Tong has issued a sweeping advisory clarifying that businesses deploying artificial intelligence systems remain fully subject to the states existing legal frameworkeven in the absence of a comprehensive AIspecific statute The guidance as analyzed by Squire Patton Boggs underscores a central message for compliance officers and inhouse counsel AI does not operate in a regulatory vacuumppppComplete the form to unlock this article and enjoy unlimited free access to all PYMNTS content no additional logins required
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ppΔdocumentgetElementById akjs1 setAttribute value new Date getTime ppThe advisory directed to state agencies and privatesector stakeholders alike outlines how Connecticuts civil rights privacy data security consumer protection and antitrust laws apply to AI system development and use It also signals enforcement priorities and encourages residents to report AIrelated harms to the Office of the Attorney GeneralppAt its core the advisory reframes AI governance as an extension of existing obligations rather than a novel regulatory domain Businesses using AI in highstakes contexts such as hiring lending housing insurance and healthcare are reminded that both federal and state antidiscrimination laws remain fully enforceable The attorney general emphasizes that algorithmic decisionmaking does not insulate companies from liability where outcomes result in unlawful bias or disparate impactppPrivacy and data security requirements are another focal point The Connecticut Data Privacy Act CTDPA applies squarely to personal data used in AI systems including training datasets and model outputs Companies must comply with core obligations such as data minimization consumer notice consent mechanisms and data protection assessments Notably amendments to the CTDPA taking effect July 1 2026 will require businesses to disclose whether they use personal data to train large language modelsan explicit recognition of AIspecific risks within an existing statutory frameworkppThe advisory also highlights operational complexities unique to AI particularly around data deletion and downstream use Businesses that acquire datasets from thirdparty brokers must ensure that proper notice was provided to consumers at the point of collection Moreover any retroactive material change in data usesuch as repurposing data for AI trainingtriggers updated notice requirements and the opportunity for consumers to withdraw consentppBeyond privacy Connecticuts general data security and breach notification statutes apply to AI deployments Companies must safeguard personal information used in AI systems and promptly notify affected individuals in the event of unauthorized access or disclosureppRead more Maine Set to Become First State to Ban AI Data CentersppConsumer protection enforcement is another key pillar The Connecticut Unfair Trade Practices Act CUTPA provides broad authority to police deceptive or unfair uses of AI including misleading advertising generated or facilitated by automated systems The statute carries significant enforcement tools including civil penalties injunctive relief and a private right of action for affected consumersppSimilarly the Connecticut Antitrust Act applies to AIdriven market behavior The advisory warns against the use of algorithms to coordinate pricing allocate markets or otherwise engage in anticompetitive conductwhether in AI products themselves or in downstream marketsppImportantly per Squire the attorney general situates this guidance within a broader enforcement trajectory The advisory references prior actions targeting the misuse of algorithms to create addictive design features for minors and to reinforce monopolistic dynamics in sectors such as search mobile ecosystems and ticketingppWhile Connecticut lawmakers are considering several AIrelated bills including measures addressing data brokers algorithmic pricing and automated employment decisions those proposals remain in early stages and are unlikely to be enacted in the current legislative sessionppFor now the message from Connecticut regulators is unambiguous Companies cannot wait for bespoke AI legislation before addressing risk Existing laws already impose substantive compliance obligations on AI systems and enforcement authorities are prepared to act accordinglypp
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ppΔdocumentgetElementById akjs1 setAttribute value new Date getTime ppThe advisory directed to state agencies and privatesector stakeholders alike outlines how Connecticuts civil rights privacy data security consumer protection and antitrust laws apply to AI system development and use It also signals enforcement priorities and encourages residents to report AIrelated harms to the Office of the Attorney GeneralppAt its core the advisory reframes AI governance as an extension of existing obligations rather than a novel regulatory domain Businesses using AI in highstakes contexts such as hiring lending housing insurance and healthcare are reminded that both federal and state antidiscrimination laws remain fully enforceable The attorney general emphasizes that algorithmic decisionmaking does not insulate companies from liability where outcomes result in unlawful bias or disparate impactppPrivacy and data security requirements are another focal point The Connecticut Data Privacy Act CTDPA applies squarely to personal data used in AI systems including training datasets and model outputs Companies must comply with core obligations such as data minimization consumer notice consent mechanisms and data protection assessments Notably amendments to the CTDPA taking effect July 1 2026 will require businesses to disclose whether they use personal data to train large language modelsan explicit recognition of AIspecific risks within an existing statutory frameworkppThe advisory also highlights operational complexities unique to AI particularly around data deletion and downstream use Businesses that acquire datasets from thirdparty brokers must ensure that proper notice was provided to consumers at the point of collection Moreover any retroactive material change in data usesuch as repurposing data for AI trainingtriggers updated notice requirements and the opportunity for consumers to withdraw consentppBeyond privacy Connecticuts general data security and breach notification statutes apply to AI deployments Companies must safeguard personal information used in AI systems and promptly notify affected individuals in the event of unauthorized access or disclosureppRead more Maine Set to Become First State to Ban AI Data CentersppConsumer protection enforcement is another key pillar The Connecticut Unfair Trade Practices Act CUTPA provides broad authority to police deceptive or unfair uses of AI including misleading advertising generated or facilitated by automated systems The statute carries significant enforcement tools including civil penalties injunctive relief and a private right of action for affected consumersppSimilarly the Connecticut Antitrust Act applies to AIdriven market behavior The advisory warns against the use of algorithms to coordinate pricing allocate markets or otherwise engage in anticompetitive conductwhether in AI products themselves or in downstream marketsppImportantly per Squire the attorney general situates this guidance within a broader enforcement trajectory The advisory references prior actions targeting the misuse of algorithms to create addictive design features for minors and to reinforce monopolistic dynamics in sectors such as search mobile ecosystems and ticketingppWhile Connecticut lawmakers are considering several AIrelated bills including measures addressing data brokers algorithmic pricing and automated employment decisions those proposals remain in early stages and are unlikely to be enacted in the current legislative sessionppFor now the message from Connecticut regulators is unambiguous Companies cannot wait for bespoke AI legislation before addressing risk Existing laws already impose substantive compliance obligations on AI systems and enforcement authorities are prepared to act accordinglypp
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