Raoul Seeks Consumer Protections in Character.AI Bankruptcy

CHICAGO – Illinois Attorney General Kwame Raoul has joined a bipartisan coalition of 40 attorneys general seeking consumer protections in the bankruptcy proceedings of Character Technologies, the company behind the Character.AI chatbot platform. The coalition raised concerns about the company’s handling of sensitive information, including private conversations involving children and adults, and called for safeguards if the company’s business or assets are sold. Character.AI allows users to interact with artificial intelligence characters designed to imitate human conversation and relationships. Several states began investigating the company after a 2024 wrongful death lawsuit alleged that its chatbots fostered an emotionally and sexually exploitative relationship with a child, reinforced his suicidal thoughts and contributed to his death. The attorneys general want protections to prevent a future buyer from reversing or bypassing restrictions on minors’ access to certain features. The states plan to remain involved in the bankruptcy case and may challenge a proposed sale or plan that fails to protect consumers’ personal information.