AI News Brief for Thursday, May 28, 2026

neoClarity    May 28, 2026

  • Three States Draw New Lines on AI and Your Personal Data.
    Connecticut now bars companies from selling your location history and requires employers to disclose when AI influenced a hiring or firing decision.

  • States Are Requiring AI Chatbots to Be Upfront About What They Are.
    New state laws now require AI chatbots to disclose they are not human, a protection that matters for anyone using AI for support, information, or daily tasks.

Three States Draw New Lines on AI and Your Personal Data

Privacy & Data Security
Source: IAPP
https://iapp.org/news/a/notable-ai-privacy-bills-hit-finish-line-in-illinois-connecticut-and-new-york

In a nutshell

Three states finalized landmark AI and privacy laws this week. Connecticut Gov. Lamont signed SB 4 banning geolocation data sales and adding facial recognition rules, plus SB 5 requiring disclosure when AI drives employment decisions and regulating AI companions. New York added the Safe By Design Act to its budget protecting minors from AI-enabled platforms. Illinois SB 315 (mandatory AI audits) awaits the governor's signature.

Why it's important

Connecticut now bars companies from selling your location history and requires employers to disclose when AI influenced a hiring or firing decision -- direct protections for anyone job-searching or concerned about how personal data moves through the digital economy.

Key takeaways

  • Connecticut SB 4 bans the sale of residents' geolocation data and requires data brokers to register annually starting 1 January 2027, with a consumer opt-out and deletion mechanism due by July 2028.

  • Connecticut SB 5 requires employers to disclose when automated decision-making technology plays a prominent role in employment decisions, and makes clear that anti-discrimination laws apply to those AI tools.

  • Connecticut SB 5 also regulates AI companions, requiring disclosure that interactions are with a nonhuman system and prohibiting minors under 18 from using them.

  • New York's Safe By Design Act, included in the state's fiscal year 2027 budget, requires covered platforms to restrict adult contact with minors and sets AI companion access to off by default for children's accounts.

  • Illinois SB 315 will mandate annual third-party audits of covered AI systems, along with pre-deployment reporting on model capabilities, intended uses, and risk disclosures; Gov. Pritzker has indicated he will sign it, with the law taking effect 1 January 2027.

  • Illinois SB 315 defines "catastrophic risk" as models capable of mass harm or damages exceeding USD 1 billion, and counts both OpenAI and Anthropic among the covered entities that publicly supported the bill.

Your thoughts?

If an employer had to tell you that AI played a role in a hiring or promotion decision affecting you, what details would you want to know?

States Are Requiring AI Chatbots to Be Upfront About What They Are

Privacy & Data Security
Source: Troutman Pepper Locke
https://www.troutmanprivacy.com/2026/05/proposed-state-privacy-and-ai-law-update-may-25-2026/

In a nutshell

Louisiana's legislature passed a new consumer data privacy bill, joining Oklahoma and Alabama as the third state to enact such a law this year. Illinois passed five AI/privacy bills including the Consumer AI Notice Act (requiring chatbot disclosure) and the AI Companion Model Safety Act. California advanced nine bills covering data brokers, AI transparency, employment AI, and two health AI measures.

Why it's important

Multiple states are now requiring AI chatbots to disclose they are not human and that AI companion apps follow safety rules -- protections that matter for anyone using AI tools for support, daily tasks, or information.

Key takeaways

  • Illinois passed the Consumer AI Notice Act (SB 317), which requires chatbots to disclose they are not human. This makes Illinois one of the first states to put this protection directly into law.

  • Illinois also passed the AI Companion Model Safety Act (SB 316), setting safety standards for AI companion apps that people use for emotional support or daily conversation.

  • Louisiana became the third state in 2026 to pass a consumer data privacy law, joining Oklahoma and Alabama; the bill now heads to the governor.

  • California advanced nine bills in one week, including measures on data brokers, AI transparency disclosures, employment AI, and two health-related AI bills.

  • Vermont's governor signed a health care AI bill into law covering neurological rights and the use of AI in health and human services.

  • Several other states, including Rhode Island and New York, are moving their own chatbot and health AI bills forward, signaling a broad national shift toward consumer AI protections.

Your thoughts?

If an AI chatbot or virtual companion had to clearly identify itself as an AI at the start of each conversation, how would that change the way you interact with it?

This brief was prepared by Martin Danner using Claude Cowork as a research assistant.