The BaseNewsThe Verge
Now that Character.AI is going bankrupt, what happens to all of its users' data?
The Verge reports that New York Attorney General Letitia James and 40 bipartisan attorneys general filed a notice of interest in Character.AI's bankruptcy case, asking that any buyer of its assets protect sensitive user data and children. The states also disclosed a prior investigation.
Why it matters
The same thing, for different readers.
What it means for you
Private chats with companion chatbots, including children's, could be sold in a bankruptcy unless a court sets conditions.
For lawmakers
Attorneys general use bankruptcy proceedings to press for age checks, crisis safeguards and data deletion rights.
The question it raises
Who owns the most intimate things people say to a machine when its maker fails?
In their own words
Every quotation was found, word for word, in the text we saved from the source. That shows the words are there; it does not make them true, or prove the speaker meant them as quoted.
From the source’s own text.
“This company collected some of the most private thoughts children have ever shared, and now those conversations could be sold off to the highest bidder.”
The record
- Questions
- How is AI changing childhood, health and daily life? · Who can demand evidence, delay a release or stop an unsafe deployment?
- People
- Letitia James (Speaks, New York Attorney General) · Lauren Feiner (Wrote it, senior policy reporter, The Verge)
- Also covered by
- Hacker News
- What we read
- We read the whole source.
- Found by
- The Radar, run of October 15, 2026, via
the-verge-ai(tier 2: a major outlet’s own reporting) - Cite this
- The Verge, “Now that Character.AI is going bankrupt, what happens to all of its users' data?”, October 14, 2026. Entry in the Ctrl AI Base, https://ctrlai.com/base/the-verge-2026-10-14-character-ai-bankruptcy-user-data