CeCe Moore knows a lot about her genetic makeup. So when her niece got the results of her genetic test, she knew immediately that something had gone wrong.

“My niece was listed as having an African maternal line,” Moore, a television producer who began studying her genealogy as a hobby in 2002, told FoxNews.com. “My mother and myself both tested as 100 percent European. I immediately knew that there was a mistake.”

It turned out that her niece's test – purchased from 23andMe, a California-based company that analyzes an individual's DNA to reveal potential health risks and ancestry – had been mistakenly swapped with another customer's. And her test wasn't the only one; there were 95 others.

23andMe, co-founded in 2006 by Anne Wojcicki, the wife of Google co-founder Sergey Brin, is the latest direct-to-consumer (DTC) genetic testing company to get into it with the Food and Drug Administration after it mixed up a batch of 96 genetic tests and sent them to the wrong people early this month.

Now 23andMe – along with four other companies – faces increased regulation from the FDA.

Alberto Gutierrez, who leads diagnostic test regulation at the FDA, issued five DTC genetic testing companies letters on June 11 notifying them that their tests are considered medical devices and will require regulatory approval in order to be sold.

The agency issued a similar letter in May to Pathway Genomics, which planned to partner with Walgreens and sell its genetic test over-the-counter, in addition to online. As a result, the partnership fell through.

These actions have sparked a fundamental question for the FDA and the direct-to-consumer genetic testing industry: What role should government regulators play?

The debate boils down to whether people make medical decisions based on the genetic information they receive, and, if there is a mistake with their results, whether they make dangerous health choices.

In this case, the test mix-ups left the 96 customers questioning their relation to their parents, children and relatives, as well as their ethnic background. One man's results indicated that he was a woman.

23andMe contacted those customers, then released a June 4 statement on its website acknowledging the error and proposing that LabCorp, the lab that conducts its tests, automate all sample analyses.

The timely response helped 23andMe smooth things over with many of those affected, including Moore and another 23andMe customer, Nora Probasco, whose test suggested that her mother wasn’t really her mother.

“I, along with others, contacted 23andMe to inform them of the problems we found,” Probasco said in an e-mail. “Within 24 hours, we received messages from 23andMe explaining there was a problem, and the bad results were pulled from our online pages.”

The other companies that received FDA letters included deCODEme and Navigenetics, which also sell genetic tests that use DNA analysis to reveal health risks and ancestry. Illumina and Knome were the other two.

In the FDA’s letter to 23andMe, Gutierrez wrote: “This premarket review of medical devices enables [the] FDA to protect the public from medical products that may pose an unreasonable risk of harm. It is important that they be analytically and clinically accurate so that individuals are not misled by incorrect test results or unsupported clinical interpretations.”

Dick Thompson, of the FDA Office of Public Affairs, told FoxNews.com in an e-mail that the lab mix-up was just the most recent issue to crop up with 23andMe.

“Previous discussions with the company, including requests for information on their business model and other activities, as well as their DTC efforts via Amazon.com, all factored into our decision to send the letter,” Thompson wrote.

While deCODEme welcomes the change and Knome has said it will cooperate, 23andMe has challenged the FDA’s basic premise, claiming that the genetic information it provides is merely educational. In a statement, 23andMe added that it cautions its customers to consult a health care professional before making any medical choices based on their results.

“We are sensitive to the FDA’s concerns, but we believe that people have a right to know as much about their genes and their bodies as they choose,” 23andMe said.

Rachel Nagler, 23andMe senior vice president, refused further comment when asked if a mix-up like this most recent one could cause someone to make a dangerous medical choice, as Gutierrez and the FDA have suggested.

Gutierrez said in a conference call on Monday that 23andMe shouldn’t have a problem with premarket regulations if its information is accurate.

While the FDA and 23andMe are the two main players, doctors also have a vested interest in this debate because these DTC genetic tests can cut them out of the equation.

“The problem is that these biotech labs have eliminated the part of this where you would have somebody who understands the technology and the results, and would be able to translate the results to the family,” said Dr. Robert Marion, chief of the Divisions of Genetics and of Development Medicine at the Children's Hospital at Montefiore in New York. “By separating that, you’re sending raw information to families who often may not understand what this means for their future.”

On the other side, 23andMe users like Moore and Probasco believe that the real problem is the doctor, the government, or any other middle-man.

“What scares me is that there are those that feel these DNA test should go through a doctor,” Probasco said.

“I just think that it would be a shame that consumers didn't have direct access to their own genome... If we all have to go to our doctors and get a prescription, and then go to a genetic counselor to have our results analyzed, how many people are going to be able to do this?” Moore said.

Both Moore and Probasco, who consider themselves hobbyist genealogists, believe that the quick response and resolution of 23andMe’s lab mix-up is proof that the industry is better equipped to regulate itself.

“A blunder like this in the medical community may never have become public, and certainly not this quickly,” Moore said. “This snafu actually is a good example of successful self-regulation through transparency and should be seen as an argument against outside interference.”

Marion has a different take, arguing that not everyone who buys these tests has educated himself to a point where he can make good decisions.

“They’re going to act on this medically... when you start doing testing for specific markers for genetic disease, that’s information that an individual is going to use to guide their medical management in the future,” he said.

He warned that as the technology for genetic testing advances and the costs come down, the risk of people acting on medical information that they receive from a company like 23andMe will only increase.

“I’m not saying that we shouldn’t be doing this, and people shouldn’t participate in this, but we need to step back and say, ‘what are the ethical, legal and social issues of this?’” Marion said.