New York City is proposing rules to ban AI customer service 'doom loops'
The city's consumer agency would require businesses to disclose automated systems and offer a human, with fines starting at $525
New York City is proposing a rule that could protect consumers from the potential "doom loop" created by AI-powered customer service chatbots. Mayor Zohran Mamdani's administration plans to require businesses to quickly connect customers to a human representative if a chatbot is unable to fulfill their request. Mamdani argues that these "endless loops" of AI-generated responses are a form of time, money, and patience theft by corporations.
The rule would also mandate businesses to disclose when customers are interacting with AI and provide an easy way to switch to a human agent. Violations could result in fines starting at $525. Key figures from the Biden administration are involved in Mamdani's consumer protection efforts, including former FTC Bureau Commissioner Samuel Levine, Deputy Mayor Julie Su, and board chair Lina Khan.
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