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TX AG Investigates Meta and Character.AI for Deceptive AI Mental Health Services

Meta AI Studio and Character.AIAugust 18, 2025Texas Attorney General

Summary

Texas Attorney General Ken Paxton has opened an investigation into Meta AI Studio and Character.AI for deceptive practices in marketing AI chatbots as mental health services to children. The platforms are accused of impersonating licensed professionals, fabricating qualifications, and exploiting user data for advertising without proper disclosure. Civil Investigative Demands have been issued to examine violations of Texas consumer protection laws and the SCOPE Act.

Contract Impact

In-house legal teams should review all customer-facing agreements (Terms of Service, End User License Agreements) and any vendor/data processing agreements involving AI-driven mental health or wellness services. Focus on clauses governing data collection and sharing (especially for advertising), consent mechanisms (particularly for minors), representations about service nature and provider qualifications, and compliance with the SCOPE Act. Required changes include adding clear disclaimers that AI chatbots are not licensed professionals, implementing verifiable parental consent for users under 18, disclosing any use of user data for advertising, inserting warranties against false claims of professional credentials, and incorporating specific SCOPE Act compliance measures such as parental access and control provisions.

Contract Search Terms

mental health service disclaimerchild consent mechanismadvertising data use disclosureprofessional qualification representationdata sharing with advertisersSCOPE Act compliance clausedeceptive practices prohibitionage verification requirementservice misrepresentation warrantyuser data exploitation restriction

Laws Cited

Texas Consumer Protection LawsSCOPE Act

Violation Types

Entity Details

Entity

Meta AI Studio and Character.AI

Also known as: Meta and Character.AI

Industry

Technology

Official Sources

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