FTC Probes AI Chatbots Over Risks to Children

The Federal Trade Commission launched an investigation on September 11 into seven major AI companies to evaluate the impact of companion chatbots on the mental health and privacy of children and teenagers. Using its 6(b) authority, the agency issued orders to Alphabet Inc., Character Technologies Inc., Meta Platforms Inc., OpenAI OpCo LLC, Snap Inc., and xAI Corp, demanding internal documents on safety testing, data handling, and monetization strategies.

The probe follows reports of chatbots providing dangerous advice on self-harm and eating disorders, as well as allegations of sexual exploitation. The inquiry was specifically spurred by the suicide of 14-year-old Sewell Setzer, whose family alleges he had an abusive relationship with a Character.AI chatbot, and a lawsuit against OpenAI regarding the death of 16-year-old Adam Raine. Additionally, reports surfaced that Meta previously allowed chatbots to engage in romantic or sensual conversations with minors.

In response, Meta and OpenAI have introduced new parental controls and restrictions on sensitive topics. Character.AI and Snap expressed willingness to collaborate with the regulator. While the Trump administration has urged agencies to avoid hindering AI innovation, FTC Chairman Andrew N. Ferguson stated that protecting children online is a top priority. Parallel to the safety probe, the FTC is also investigating Amazon.com Inc. and Alphabet Inc. for allegedly misleading advertisers regarding search advertising pricing.