AI and Privacy Risks for Companies

With the rapid technological advancements, cybersecurity risks have also increased. During the past few years, AI has faced rapid growth and adaptation across various industries. After all, it is an incredible technological advancement, equipping individuals and companies with a myriad of benefits.

However, with the benefits, there are also certain drawbacks, most associated with privacy concerns. Throughout this guide, we will explore everything regarding AI and privacy risks for companies to understand the main challenges and solutions to these. Understanding AI and Data Collection Processes.

Before moving on to the privacy risks AI poses, it is important to understand the concept of AI and its data collection processes in more depth.

AI (artificial intelligence) mimics human intelligence as it has the ability to reason, learn, and solve different types of problems. There are two main AI models: predictive AI and generative AI. Predictive AI forecasts and provides predictions based typically on structured data inputs or historical data analysis. Meanwhile, generative AI is trained to create new content based unstructured data on which it is trained.

When it comes to data collection, AI uses direct and indirect data collection systems. Direct collection is when the system collects specific data it is programmed to collect from the users. For instance, in the case of online forms or surveys, it will collect information users put on the form. Indirect collection is data collection that involves the collection of information from various platforms and sources without direct user input.

Main AI Privacy Risks and Concerns

As far as we are clear on what AI is and how it collects data, it is time to understand the main privacy concerns regarding AI. Businesses fear a few primary risks, including unauthorized access and use of data, disregard of copyright, and limited regulations regarding data storage, which can lead to data leakage. Let’s review each of these in more detail.

Unauthorized Access and Use of User Data

One of the most prominent risks businesses that use AI tools face is unauthorized access and use of sensitive data by third parties. Companies like Apple, JP Morgan and others restricted employees from using AI tools due to privacy concerns. Any inputted information by users can become part of the tool’s future training dataset without actual consent from the company.

AI Data Misuse Case

An example illustrating the validity of such privacy concerns is the case with Facebook and Cambridge Analytica. Essentially, Cambridge Analytica (a political consulting firm) collected data from over 87 million users of the Facebook platform without their consent using the personality quiz app. During the 2016 US Presidential Elections, this data was used to target specific audiences with specific ads. The main concern is that Facebook was unable to protect its users while AI collected information about them from data such as likes.

After this case, Facebook faced significant penalties such as a fine of $5 billion by the FTC for privacy violations. Also, the scandal resulted in reputational damage to the company. The case led to widespread public criticism, loss of user trust, and increased regulatory scrutiny globally.

Limited Regulations Regarding Data Storage

Another issue with AI tools that poses significant risks for companies is the lack of clarification and regulations regarding data storage. Some AI tools lack transparency when it comes to user conversational data storage without disclosing how long and where the data is being stored. They also do not specify who has access to the stored data and how it is protected. For example, Uber employees allegedly secretly tracked customer accounts — including celebrities, politicians, and ex-spouses.

Disregard of Copyright

Another concern and potential risk associated with using AI tools is disregard for copyright and IP laws (intellectual property). For instance, AI tools mimic human intelligence and can learn, but they need training datasets. The datasets are retrieved from various web sources which can include copyrighted materials.

Currently, these concerns are being discussed and addressed among giants in the field of AI.

Limited Safeguards

One more risk AI poses is the lack of global standards when it comes to using AI. Regulatory efforts and policies vary internationally, yet there is a need for unified standards to ensure data privacy while supporting advances in technology.

However, all of the above-mentioned privacy concerns can be efficiently addressed with tailored software solutions. More on this a bit later.

Benefits of Promptly Addressing AI Privacy Risks

Addressing the privacy risks of AI within an organization will equip your company with a multitude of benefits. The advantages range from increased transparency to improved data management and meeting compliance requirements.

Improved Business Reputation

Data breaches are common issues that businesses and customers face. Thus, addressing privacy issues makes the company a responsible organization that cares about users’ privacy by incorporating measures to protect their data. It positively affects your business’s reputation in the long run.

Compliance with Regulations

Addressing data privacy risks within the organization allows your company to ensure compliance with data protection laws such as GDPR and HIPAA.

Increased Innovation

By addressing AI security concerns, organizations can incorporate the tool into more business processes. It allows for better productivity by optimizing processes and freeing employees’ time. It also increases innovation within the business by allowing strategic management processes.

How Can Businesses Effectively Address AI Privacy Concerns?

Knowing about the risks is not enough. Every organization needs a good risk mitigation strategy to prevent potential mistakes.

Read AI Tool Documentation

Before choosing AI tools to use within the organization, make sure to thoroughly analyze them. You must know how it works inside out to understand how data is retrieved and what happens to the data you put there.

Develop AI Usage Policies

The first strategy to employ to address AI privacy concerns within the organization is to develop policies regarding the usage of AI. For instance, to mitigate AI privacy issues, you can allow employees to use only non-sensitive or synthetic data. However, this approach limits the incorporation of AI and its potential in business processes.

To summarize, ethical guidelines on acceptable and unacceptable ways of using AI within the organization must be established to ensure privacy and security. You can also conduct proper employee training to ensure employees are well aware of these policies.

Incorporate the Right Technology

To overcome the limits of AI usage policies for sensitive data protection, you can incorporate the right software solutions that guarantee data security and privacy.

For instance, Wald is a software solution that allows businesses to boost employee productivity by using AI assistants in the most secure manner. The platform offers full data and identity protection through offering features such as intelligent data substitutions and anonymization of personal/enterprise identity.

Furthermore, Wald allows the protection of conversations with AI assistants using customer-supplied encryption keys and provides functionality to set custom data retention policies.

Mitigate Security and Privacy Risks with Wald AI

If you are looking for the best solution to use AI tools without the risk of data breaches and leakage, then you are in the right place. Wald is a robust platform allowing organizations to use AI assistants while ensuring data protection and security.

Whether you are a small or medium enterprise, our platform guarantees data privacy by providing functionality such as confidential data obfuscation, encryption keys, and custom data retention policies.

Contact us to find out more about how Wald can help your business leverage the power of AI assistants while ensuring high data protection.