Module 3 – Week 11: Data Literacy, Privacy, and Compliance in AI


Unit Title: Understanding the Power and Responsibility of Data
Level: Applied Professional Practice
Duration: 120–150 minutes (flexibly divided over 2–3 sessions)


🎯 Learning Objectives

By the end of this week, you should be able to:

  • Understand key data concepts and types relevant to AI use.
  • Recognise personal, organisational, and public data vulnerabilities.
  • Evaluate and improve your privacy hygiene as an AI user.
  • Apply ethical and legal compliance standards (e.g., GDPR, copyright, model licensing).
  • Construct workflows that respect data boundaries and storage norms.

🧭 Lesson Flow

SegmentDurationFormat
1. Introduction to Data Literacy25 minConceptual and Technical
2. Privacy in the Age of AI30 minPractices and Exposure Risk
3. Compliance and Regulation25 minLegal/Ethical Frameworks
4. Safe AI Workflow Design20 minTemplates and Habits
5. Exercises + Knowledge Check40–60 minData Audits and Redesigns

🧑‍🏫 1. Introduction to Data Literacy

📖 Teaching Script:

AI is only as trustworthy as the data that trains or feeds it.
As a user, your ability to understand, respect, and guard data integrity defines the quality and safety of your AI practices.


📘 Key Data Types for AI Users:

Data TypeExamples
Structured DataSpreadsheets, tables, databases
Unstructured DataEmails, PDFs, audio, freeform notes
Personal DataNames, addresses, IP, emails
Sensitive DataHealth info, race, religion, biometric
Public Domain DataGovernment reports, open-source datasets

🧠 Terms to Know:

  • PII = Personally Identifiable Information
  • Anonymisation = Removing links between data and identity
  • Data provenance = Origin or source of the data
  • Metadata = Data about the data (e.g., timestamps, author)

🔍 Three Mini-Examples:

  1. Using AI to analyse customer feedback emails: how do you ensure PII isn’t leaked or retained?
  2. Creating a dataset for training a policy summariser: where did the texts come from?
  3. Asking AI to rewrite a document with internal figures: are those figures supposed to be shared?

🛡️ 2. Privacy in the Age of AI

📘 Common Privacy Risks:

Risk TypeExample
Unintentional exposureAI trained on sensitive student papers outputs them again
Input memory leaksPrompting AI with client details that get “remembered”
Public-facing misuseUsing real chat logs for training or marketing without consent

🧠 Tools and Tips for Privacy Hygiene:

  • Redact sensitive data before entering prompts
  • Use synthetic data (invented but realistic) for testing
  • Work in private browsing/incognito modes when experimenting
  • Avoid storing sensitive prompts in shared tools (Notion, Google Docs)

🧪 Example Prompts to Practise Privacy:

  1. “Create a simulated user profile without real names or emails.”
  2. “Turn this raw health data into anonymised case summaries.”
  3. “Evaluate whether this prompt includes personal data.”

⚖️ 3. Compliance and Regulation

📘 Frameworks You Must Know:

RegulationKey FocusApplies To
GDPR (Europe)Data rights, processing limitsAny EU subject’s data
UK Data Protection Act 2018National implementation of GDPRUK-specific operations
CCPA (California)Consumer opt-out and transparencyCalifornia users
OpenAI/Anthropic LicencesUsage rights, commercial termsYou as a platform user
Copyright LawAI-generated reuse of text/imagesPublications, education, creative use

🧠 Scenarios to Apply Law:

  1. You ask ChatGPT to summarise a paid eBook — is that compliant?
  2. You build a policy newsletter from scraped government pages — do you credit the sources?
  3. You copy Midjourney art into your product packaging — do you have usage rights?

✏️ Sample Compliance Prompt:

“Check the above content for copyright or licensing risk. Identify if sources need attribution.”


🧩 4. Safe AI Workflow Design

📘 Safe AI Use Habits:

HabitDescription
Always document source dataTrack what went in and where it came from
Anonymise before inputTurn “Jane from London” into “a 35-year-old woman”
Use disclaimersLet others know your content was AI-assisted
Avoid uploading client/internal docsDon’t give AI access to contracts, internal comms, or accounts

🧪 Workflow Design Examples:

Scenario: You generate quarterly business insights for clients
Workflow:

  1. Upload redacted data (no names or firms)
  2. Prompt for trends only, no case-specific predictions
  3. Review output against privacy checklist
  4. Add disclaimer: “AI-assisted. All data anonymised.”

📘 Template: AI Compliance Checklist

  • Have I removed or hidden sensitive data?
  • Am I allowed to use this data in this way?
  • Is the output legally shareable or distributable?
  • Do I need to cite or disclose AI use?

🧪 5. Exercises + Knowledge Check

✅ Exercise 1: Privacy Redesign

Take one of your recent AI outputs.

  • Identify data risks
  • Rewrite the prompt with redaction
  • Add a disclaimer paragraph

✅ Exercise 2: Compliance Reflection

Pick one of the following: GDPR, CCPA, UK DPA.

  • Summarise it in your own words
  • List 2 ways it applies to your AI usage
  • Write 100-word checklist based on it

✅ Exercise 3: Build a Privacy-First Prompt

Design a prompt that asks for insight without breaching data sensitivity.
Test it. Review its safety with the audit checklist.


🧠 Knowledge Check (10 Questions)

  1. What is PII and give 2 examples?
  2. Name one key difference between structured and unstructured data.
  3. What does GDPR regulate?
  4. What is data provenance and why is it important?
  5. How can you anonymise AI inputs?
  6. What are 2 risks of memory leaks in chat tools?
  7. When do you need to disclose AI use?
  8. Write a privacy-safe version of this prompt: “Summarise client email from Mary, age 52, about her cancer case.”
  9. What is synthetic data?
  10. Why should you avoid storing AI prompts in public docs?

📝 Wrap-Up Assignment (Optional)

Title: “Designing Ethical and Legal AI Workflows”

Include:

  • One high-risk example you’ve fixed
  • Your 5-rule AI privacy checklist
  • A 100-word summary of a regulation (e.g., GDPR)
  • Reflection: What have you changed in your AI habits?

📦 End-of-Week Deliverables

  • ✅ Prompt redacted and rewritten
  • ✅ Compliance summary + checklist
  • ✅ Privacy-first prompt built and tested
  • ✅ Knowledge check completed
  • ✅ Optional: Workflow audit reflection