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AI and Personal Data: Key Considerations About Ethical AI Data Processing

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AI's potential to transform lives is undeniable, from smart assistants to advanced data analysis. But this progress hinges on ethical data processing. As AI becomes more sophisticated, concerns about personal privacy escalate. 

The struggle to balance innovation with data protection isn't new. The General Data Protection Regulation (GDPR) emerged in Europe as a response to the digitization of information and the growing fear of unchecked data collection. Similarly, in the United States, the Health Insurance Portability and Accountability Act (HIPAA) initially focused on digitizing medical records. However, it quickly evolved into a data protection law, recognizing the need to safeguard sensitive medical information in the digital age.

This article explores the balance between innovation and data protection, examining how we can harness AI responsibly.


How does AI use personal information? 

For many years now, AI has powered recommendation systems built on users’ online behaviors, the content they like and interact with, and their browsing habits.

From influencing our online purchases to aiding medical diagnoses, AI thrives on personal data. Recommendation systems analyze browsing habits and online interactions to suggest products, content, or even connections.

The possibilities for AI’s use of data are endless. 


Why are people concerned about AI using their personal data? 

AI systems are improved by analyzing vast amounts of data. Still, the main concern is the source of information it analyzes, mainly because it opens fraud possibilities. In addition to this, algorithms based on biased data can perpetuate the discrimination of actual living people regarding job applications, mortgages, or other decisions where risks should be calculated. 

For example, malicious actors now have an opportunity to send you an email pretending to be someone else and ask AI to generate an email as if your manager sent it himself, facilitate their voice, or even make a video call. A malicious actor is someone who deliberately uses computers and the internet to commit illegal actions such as trying to steal information, damage computer systems, or spread misinformation.

The security of information processed by AI is a high concern. Suppose information from different sources is not appropriately protected when AI is developed. In that case, it can be hacked and used to find out more information about a phishing target, and it can source home addresses from databases that were supposed to be protected, etc.  


What law regulates how AI processes personal information? 

Many data protection laws already cover the use of AI. They focus on making sure that data processing is transparent, secure, and accountable. For example, the GDPR in Europe doesn't allow decisions based only on AI; it requires human verification of results. Some US state laws, such as California, Colorado, Connecticut, or Virginia also give consumers the right to know about this kind of processing and opt out of it if it could have legal or other consequences.

In the UK, legislators are working on becoming an "AI superpower" with a new strategy that aims to manage AI risks while promoting innovation, while Canada is updating its privacy laws with the proposed Artificial Intelligence and Data Act, which is part of a larger legislative package.

Singapore has its National AI Strategy, including a Model AI Governance Framework and practical use cases to help organizations develop their own AI governance. Just recently, China released draft measures to regulate AI services and ensure that content created by AI aligns with social order, avoids discrimination, and respects intellectual property.



Data privacy regulations
are constantly evolving. Are you covered?

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Data Processing Ethics Principles 

While existing laws provide a framework, ethical data processing principles are equally important for responsible AI development. While the core principles themselves aren't fundamentally different from other fields, their implementation with AI can be more complex and may pose greater challenges for AI developers. 

Nevertheless, the fundamental principles outlined by most laws and regulations have also become standard practice in the business world in recent years. Below are the key principles met across law and standard best practice:

  • Transparency: You must be open and honest about how you collect, store, and use personal data. Inform individuals about the purposes of data collection and any potential sharing of their information.
  • Fairness: Treat individuals fairly and lawfully, avoiding discrimination and ensuring that data is not misleading. Handle personal information in a way that is not detrimental to the individuals involved.
  • Accuracy: Maintaining data accuracy is essential. Ensure that the personal information you hold is up-to-date, relevant, and correct to make informed decisions and prevent potential harm due to misinformation.
  • Privacy: Respect individuals' privacy as a fundamental aspect of data processing. Implement measures to protect personal data from unauthorized access or misuse, building trust and ensuring compliance with data protection regulations.
  • Accountability: Be responsible for implementing appropriate policies and procedures, conducting privacy assessments, and effectively responding to data subject requests. Being accountable for data processing practices instills confidence in your customers and stakeholders.

The key takeaway here is that the importance of data protection and ethical considerations in AI data processing cannot be overstated. It is crucial to recognize the positive impact of responsible AI development on both society and individuals’ trust in technology. 

By prioritizing ethical guidelines and user awareness, we can ensure that AI is developed and utilized in a manner that respects privacy, promotes fairness, and upholds transparency. In the end this means we must all work towards further ethical guidelines, increased user awareness, and collaborative efforts to shape a future where AI thrives responsibly for the betterment of society.



FAQs on AI Data Processing

How does AI use personal information?

AI uses personal data to power recommendation systems, analyze browsing habits, and suggest products or content. It can influence online purchases, aid medical diagnoses, and more.

Why are people concerned about AI and personal data?

People worry about data privacy and security, potential fraud, and discrimination. AI can be exploited by malicious actors for phishing or identity theft, and biased algorithms can perpetuate unfair practices in decisions like job applications or loan approvals.

What laws regulate AI data processing?

Various laws regulate AI data processing:

  • GDPR (Europe): Requires transparency, security, and human verification of AI decisions.
  • US State Laws: Some states like California and Virginia have laws allowing consumers to opt out of certain AI data processing.
  • UK, Canada, Singapore, China: Each has strategies and frameworks to manage AI risks and promote innovation while ensuring data protection.
What are the key principles of ethical data processing?

The key principles are:

  • Transparency: Be open about data collection, storage, and usage.
  • Fairness: Avoid discrimination and handle data lawfully.
  • Accuracy: Ensure data is up-to-date and correct.
  • Privacy: Protect personal data from unauthorized access.
  • Accountability: Implement policies, conduct assessments, and respond to data requests responsibly.
How do biases in AI affect decision-making?

Biases in AI can lead to unfair decisions in areas like job applications, loans, and more. They can perpetuate discrimination and cause harm to individuals if the underlying data or algorithms are biased.