Relating to financial exploitation or financial abuse using artificially generated media or phishing communications; providing a civil penalty; creating a criminal offense.

Contracts

• Vendor Indemnification: Immediately amend Master Services Agreements (MSAs) with marketing agencies and software vendors. Require specific indemnification against claims arising under Texas Civil Practice and Remedies Code Chapter 100B (created by this bill).
• Warranties: Vendors providing AI tools must warrant that their default settings do not utilize "deceptive patterns" or generate content intended to mislead regarding its origin.
• Insurance Review: Consult brokers regarding Cyber Liability and D&O policies. Confirm coverage extends to "media liability" and "regulatory defense" for AI-related claims. *Caution: Standard policies often exclude "intentional acts," which may jeopardize coverage given the statute’s requirement of "knowing or intentional" conduct.*

Hiring/Training

• Sales & Collections Training: Retrain staff on the new legal definition of "phishing." Scripts must be scrubbed of high-pressure tactics that a court could construe as "manipulating" a consumer rather than negotiating.
• AI Disclosure Protocols: Implement a mandatory "Human-in-the-Loop" review policy for all AI-generated external communications to verify factual accuracy and prevent "hallucinations" that could be deemed fraudulent.

Reporting & Record-Keeping

• Prompt Logging: IT must configure AI systems to retain logs of all generation prompts. In the event of a lawsuit, these logs are your primary defense to prove you did not possess the "intent to deceive."
• Campaign Approval Trails: Maintain auditable records of which human manager approved specific AI-generated content for release.

Fees & Costs

• Civil Penalties: The Attorney General may seek up to $1,000 per day per violation.
• Damages: The statute allows for "actual damages," "court costs," and crucially, "mental anguish." This non-economic damage category significantly increases the potential settlement value of nuisance lawsuits.