New Mexico Proposes Legislation to Protect Victims of AI Deepfakes

New Mexico has taken a significant step in addressing the growing threat of AI-generated deepfakes with the announcement of new legislation aimed at protecting victims of this emerging form of digital abuse. The legislation, introduced by New Mexico Attorney General Raúl Torrez and State Representative Linda Serrato, seeks to impose strict penalties on those who create or distribute harmful deepfake content, marking a bold move to regulate the misuse of artificial intelligence.

Background

The proposed legislation comes in response to a recent arrest involving AI-generated child sexual abuse material. Richard Gallagher was arrested for allegedly using AI "undressing" tools to manipulate images of children, converting clothed photos into unclothed ones. This incident has highlighted the urgent need for legal measures to address the misuse of AI technology, which can have devastating consequences for victims.

The legislation, set to be discussed and voted on during the upcoming legislative session beginning on January 20, includes fines of up to $15,000 per violation for each day a company fails to comply with the regulations. This penalty is designed to deter the creation and distribution of malicious deepfakes, which can cause significant harm to individuals and society as a whole.

The Legislation's Scope

The "Artificial Intelligence Accountability Act" will require generative AI servers and social media platforms to embed markers or "signatures" into images, allowing law enforcement to trace illegal AI-generated content back to its source. This measure is intended to hold perpetrators accountable and provide a means for victims to seek justice. Additionally, the legislation creates civil liability for individuals who produce and knowingly reshare malicious deepfakes, enabling victims to sue for damages or recover $1,000 per impression.

The bill also includes provisions to add an additional year to felony sentences if AI is used in connection with the crime. This reflects the seriousness with which New Mexico is treating the issue of AI-generated harm, as well as the state's commitment to protecting its citizens from this evolving threat.

Federal and Political Context

The announcement of the legislation follows President Trump's executive order signed on December 11, 2025, which aims to limit state-by-state regulations on AI. The order directs the administration to take action against laws that threaten innovation in AI, including potentially withholding federal funding for broadband programs from states with such regulations. However, New Mexico Attorney General Raúl Torrez has expressed confidence in the state's ability to implement the legislation despite federal pushback.

Torrez emphasized that the state is empowered by the U.S. Constitution to protect its citizens and that the federal government can only preempt state action with a bill passed by Congress that explicitly prevents states from taking action. This stance underscores New Mexico's determination to lead in creating an ecosystem where AI works for the benefit of its people, rather than being exploited for harm.

The legislation has sparked debate over the balance between innovation and regulation in the AI sector. While some argue that strict regulations could stifle technological progress, others maintain that protecting citizens from the harmful misuse of AI is a priority. New Mexico's approach reflects a growing recognition of the need for accountability in AI development and deployment, as the technology becomes increasingly integrated into everyday life.

As the legislative session approaches, all eyes will be on New Mexico to see how this groundbreaking legislation unfolds. If passed, it could set a precedent for other states seeking to address the challenges posed by AI deepfakes and ensure that technology serves the greater good.