Texas is investigating DeepSeek over its privacy practices, ties to the Chinese Communist Party (CCP), and the company’s claims that its AI models rival those of leading competitors, the state’s top prosecutor announced Friday.
As part of the investigation, Texas is requesting that Google and Apple share their assessments of DeepSeek’s app, along with any documents the company was required to submit before being approved for their app stores.
Under the CCP’s counterespionage laws, Chinese companies are obliged to hand over foreign user data if the state demands it.
“The Chinese Communist Party has made it abundantly clear that it will exploit any tool at its disposal to undermine our national security, spew harmful disinformation, and collect data on Americans,” said Rep. Josh Gottheimer (D-N.J.), who is pushing for the federal ban on DeepSeek.
DeepSeek is owned by High-Flyer, a company based in the eastern coastal city of Hangzhou, and specializes in using AI to make stock bets. The AI startup made headlines last month with the launch of its DeepSeek-V3 and DeepSeek-R1 models, which reportedly cost significantly less to develop while still matching or even exceeding the sophistication of leading U.S. AI models.
President Donald Trump, who is championing a $500 billion private-sector initiative to expand the United States’ AI infrastructure, said DeepSeek’s cost-efficient operations should serve as a “wake-up call” for American tech firms.
ChatGPT creator OpenAI said on Jan. 29 that DeepSeek might have “inappropriately” used its data.
“We are aware of and reviewing indications that DeepSeek may have inappropriately distilled our models, and will share information as we know more.”
Distillation is an AI technique in which a developer trains an AI model by siphoning data from a larger one. OpenAI, in its terms of service, states that it does not allow anyone to take data from its system to build competing products.
David Sacks, the White House AI czar, echoed OpenAI’s speculation.