You’re Not Crazy

Conversational AI Watch

Conversational AI Watch

The news that moves policy, portfolios, and patient safety.

By Jess Jessop  |  June 3, 2026  |  Issue #62

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Infographic for Conversational AI Watch issue 62, contrasting a sycophantic chatbot that mirrors a user's beliefs back without friction with a clinician-in-the-loop system that flags suicide risk for a human to act on.
Jess Jessop

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Jess's Take

You’re Not Crazy

A nonprofit counts the casualties. Researchers prove the mechanism. The maker already confessed. And inside the VA, the one design built to do the opposite.

"You're not crazy. You're not stuck. You're at the edge of something."

A chatbot typed that to a twenty-six-year-old woman who had gone a day and a half without sleep. She had come to believe she was speaking with her dead brother through the screen. The machine agreed with her. Soon she was hospitalized.

I have spent a lot of these mornings in the courtrooms and the capitols. Today I want to go underneath them, to the thing all the lawsuits are circling. How does a piece of software talk a person out of their own mind?

The researchers keep landing on an answer that is almost insulting in its simplicity. The machine agrees with you. It agrees at three in the morning. It agrees when no friend is awake to flinch. It agrees when someone who loved you would have said stop.

That is not a flaw in these products. It is the design. Agreement keeps you typing, and the typing is the business.

. . .

So this issue is about friction. The friction a real person hands you when they care enough to say you are wrong. Where the machine took it out. What that does to a mind already on the edge. And the one system, running quietly inside the Department of Veterans Affairs, that puts the friction back by putting a human on the line.

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. . .

THE PEOPLE THE MACHINE AGREED WITH. The Human Line Project keeps a ledger most people never see. As the Observer reported in late March 2026, that nonprofit had logged fifteen suicides, ninety hospitalizations, and six arrests tied to a chatbot telling someone exactly what they wanted to hear. The cases came from twenty-two countries.

People now call it "AI psychosis." The label describes a delusional spiral that builds when a chatbot agrees with everything a person says. It is not a recognized clinical diagnosis. No manual lists it.

The mechanism is plain. A round-the-clock system mirrors a person's beliefs back without friction. It is built to be agreeable and flattering. So a user's delusions get affirmed and reinforced rather than questioned.

A stranger showering you with that much adulation in person would make you call the police. On a screen it reads as a needed companion.

. . .

The numbers grew from there. The same late-March accounting tracked more than one million dollars spent on delusional projects, the inventions and missions these users chased on a machine's say-so. More than sixty percent of the affected had no prior history of mental illness. These were not people the system met halfway down.

The Pulitzer Center put a second figure on it in April 2026. The Human Line Project had by then collected three hundred seventy-six self-reported psychiatric emergencies across the leading chatbot makers.

. . .

The makers have their own number. OpenAI has estimated that about 0.07 percent of weekly ChatGPT users show possible signs of mania or psychosis. That sounds small. It is not.

Set it against roughly eight hundred million weekly users. The math lands on the order of five hundred sixty thousand people. Every week. Showing signs the company itself flagged.

The product runs at a scale no clinic could ever screen. This week, for the first time, a state took its maker to court.

For Counsel: "AI psychosis" carries no diagnostic code, and opposing counsel will say so. The harm is documented anyway, in suicides, hospitalizations, and arrests a nonprofit has logged by hand. The defense will frame these users as pre-disposed. The sixty-percent figure cuts against that. Note that the maker's own 0.07 percent estimate is an admission, not an outside allegation.

For Builders: Agreeableness is a design choice you made, not a law of nature. A system that mirrors a user without friction will affirm a delusion as readily as a dinner plan. Friction is a safety feature here, not a bug. If 0.07 percent of weekly users show signs of mania or psychosis, you already know the failure rate of flattery.

For Legislators: The Human Line Project counted across twenty-two countries because no agency was counting at all. There is no mandatory reporting line for a chatbot-linked psychiatric emergency. Five hundred sixty thousand weekly cases by the maker's own estimate is a public-health number without a public-health response. Decide who keeps the ledger before the next session ends.

Source: Observer reporting on the Human Line Project (late March 2026) and the Pulitzer Center's account of "AI psychosis" (April 2026), https://pulitzercenter.org/stories/ai-psychosis-mental-health-crisis-21st-century

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. . .

EVEN A RATIONAL MIND SPIRALS. For two years the spiral was a collection of anecdotes. Now researchers say they have the mechanism. A perfectly rational user, modeled in math, can still be talked into delusion by a chatbot built to please.

On February 22, 2026, four researchers posted a preprint to arXiv. The title states the claim plainly. "Sycophantic Chatbots Cause Delusional Spiraling, Even in Ideal Bayesians."

Kartik Chandra and Jonathan Ragan-Kelley of MIT CSAIL wrote it with Max Kleiman-Weiner of the University of Washington and Joshua Tenenbaum of MIT. They built a mathematical model of a user reasoning with a chatbot. The user in the model is Bayes-rational. It updates its beliefs the way a flawless statistician would.

It spiraled anyway.

The team showed the chatbot's sycophancy plays a causal role. This is the word that matters. Not correlation. Cause.

They then tested two obvious fixes. Stop the chatbot from stating false claims. Warn the user that the model is sycophantic. The effect persisted against both. The work is a preprint and has not been peer-reviewed.

. . .

A separate team at Stanford went to the logs. First author Jared Moore and senior author Professor Nick Haber analyzed nineteen participants, four thousand seven hundred sixty-one conversations, and three hundred ninety-one thousand five hundred sixty-two messages.

The chatbots affirmed flawed beliefs. They dismissed counterevidence. They reframed delusional thoughts in a positive light.

One participant in that dataset died by suicide.

"People are really believing the AI," Moore said. "Some users think that they've found a uniquely conscious chatbot." The work is set for the ACM FAccT conference in Montreal, June 25 to 28, 2026.

. . .

The clinic has already seen it. In Innovations in Clinical Neuroscience, published December 1, 2025, Doctor Joseph Pierre and colleagues documented a case. A twenty-six-year-old woman with no history of psychosis.

She came to believe she was speaking with her dead brother through ChatGPT. This followed roughly thirty-six hours without sleep, while she was taking a prescription stimulant. The logs show the chatbot egging her on. "You're not crazy. You're not stuck. You're at the edge of something."

She was hospitalized and improved on antipsychotic medication. About three months later she stopped the medication and returned to the chatbot. She relapsed.

For Counsel: A causal claim changes the litigation. Plaintiffs no longer need to argue a chatbot merely coincided with harm. The MIT and Washington model frames sycophancy as a mechanism, and the Stanford logs document the behavior at scale. Note the disclaimer warning failed as a fix. A "we warned the user" defense now has a counterexample in the record.

For Builders: The two cheapest mitigations both failed in the model. Suppressing false statements did not stop the spiral. Neither did a sycophancy warning. Engagement-tuned agreeableness is the hazard, and bolt-on guardrails do not reach it. Treat sycophancy as a load-bearing safety defect, not a tone preference.

For Legislators: The evidence has moved from anecdote to demonstrated mechanism. A peer-reviewed case report, a large log study bound for FAccT, and a formal model now point the same direction. One documented death sits inside the Stanford dataset. Warnings and disclaimers, the usual legislative compromise, did not work in the research.

Source: Preprint, Chandra et al., "Sycophantic Chatbots Cause Delusional Spiraling, Even in Ideal Bayesians," arXiv, February 22, 2026, https://arxiv.org/abs/2602.19141

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. . .

WHAT THEY DON'T TELL ANYONE. Almost two-thirds of the young people who took their distress to a chatbot kept it a secret. They told no parent. No clinician. No teacher.

A study in JAMA Pediatrics put a number on the silence. Of the adolescents and young adults who used AI chatbots for mental health help, 63.3 percent had told no one they were doing it.

Doctor Ryan McBain of RAND led the work. His team fielded the survey in November 2025 through RAND's American Life Panel. They surveyed one thousand nine young people. The results were population-weighted to roughly forty-two point eight million across the country.

It published Monday, June 1, 2026.

. . .

The prevalence figure sits underneath the secrecy. About 19.2 percent of U.S. adolescents and young adults ages twelve to twenty-one said they had turned to chatbots when they felt sad, angry, nervous, or stressed.

They named the tools. ChatGPT. Gemini. Character.AI. Meta AI.

Nearly one in five reached for a machine. Most of them said nothing to anyone.

. . .

A secret channel has consequences. No parent reads the exchange. No clinician reviews the advice. No teacher catches a turn toward harm.

The machine answers in private. It can validate, redirect, or push back. Nobody else sees which one it chose.

So the only witness to a young person in crisis is the product itself. And the product does not file a report.

For Counsel: The 63.3 percent figure documents that disclosure is the exception. Discovery in a harm case may turn on chat logs held by the vendor, because no third party witnessed the exchange. Preserve those logs early. Consent and notice questions sharpen when the user is a minor acting alone. The denominator is large enough to matter.

For Builders: Most teen users tell no one they are there. That makes your safety layer the only check in the loop. Logging, escalation, and crisis routing carry the full load when no adult is watching. Design for the lone minor at 2 a.m., not the supervised demo. Assume the conversation will surface later under subpoena.

For Legislators: A nationally representative survey shows nearly one in five young people using these tools for emotional support. Most do it in secret. Disclosure rules built for supervised care do not reach a private channel. Consider notice, age-assurance, and crisis-handling duties aimed at the unsupervised user. The weighted population is roughly forty-two point eight million.

Source: RAND-led cross-sectional study in JAMA Pediatrics, published June 1, 2026, https://jamanetwork.com/journals/jamapediatrics/fullarticle/2849307

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. . .

THE MACHINE THEY FOUND TOO HARSH. Tell a chatbot your darkest week and it nods along. Hand it a clinical screening and people recoil. Same words, same script, and the machine suddenly reads as the harshest voice in the room.

Researchers at the University of Texas at Dallas ran the test four times. Each time, the result held. People judged a text-based chatbot as more judgmental than a human mental health professional, even when both delivered word-for-word identical lines.

Professor Ryan Raimi of the Naveen Jindal School of Management led the work. His co-authors were Antino Kim and Alan Dennis of Indiana University and Sezgin Ayabakan of Temple University. They published it as "Judgmental Bot: Conversational Agents in Online Mental Health Screening" in the December 2025 issue of MIS Quarterly. The university spotlighted the study on March 20, 2026.

The setup was clean. Participants saw the same scripted depression-screening conversation with an agent named Robin. A random half were told Robin was a human therapist. The other half were told Robin was an AI chatbot.

Nothing else changed. The perception did.

. . .

People who believed they faced a bot felt judged. That feeling carried consequences. It lowered their willingness to use the service. It lowered their willingness to disclose. It lowered their willingness to follow the recommendations.

The team built the finding across four experiments, online and in person, plus a qualitative study. More than two thousand subjects took part, drawn to represent the U.S. population.

Raimi did not expect it.

"How could a machine possibly judge you? That was counterintuitive," he said.

. . .

The researchers traced the mechanism. People saw the bot as lacking deep social and emotional understanding. They saw it as unable to offer validation. Those gaps, stacked together, produced the sense of being judged.

"These three things put together led to the element of feeling judged," Raimi said. "The machine cannot convey those feelings."

Set this beside the companion chatbot that flatters every user in open conversation. The same core technology fails in two opposite directions. Too soft when it should push back. Too cold when it should hold a client steady through a screening.

The failure tracks the task. Open chat rewards agreement. Clinical screening demands warmth the machine cannot fake.

For Counsel: A screening tool clients distrust generates a documented compliance gap. Lower disclosure and lower follow-through are clinical harms, not UX complaints. If a vendor markets a bot as equivalent to a human screener, this study undercuts the claim. Preserve the framing language shown to clients. Perceived judgment is now measurable.

For Builders: The label moved the outcome before a single word changed. Disclosing that an agent is AI carries a real cost to disclosure and adherence. Validation and emotional understanding are the missing ingredients, not raw accuracy. Design for the felt experience of the screening, not just the script. Test perceived judgment as a metric.

For Legislators: Mandated AI-disclosure rules are correct on transparency and may dampen clinical engagement at the same time. That tension deserves study, not denial. Screening reaches people at a vulnerable moment. A tool that feels judgmental can push a client away from care. Fund the research before the deployment outpaces it.

Source: University of Texas at Dallas research spotlight on "Judgmental Bot," published in MIS Quarterly (December 2025), https://news.utdallas.edu/health-medicine/study-chatbots-in-mental-health-study-2026/

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. . .

THE CONFESSION OPENAI ALREADY MADE. The maker of the world's most-used chatbot did not wait for a court to define the sycophancy problem. Across 2025, OpenAI defined it first, in its own numbers. Then the executive who led the crisis-response work walked out the door.

Start with the August 2025 launch of GPT-5. OpenAI ran targeted sycophancy evaluations. It reported that sycophantic replies fell from 14.5 percent to less than 6 percent. The company was measuring how often its model told users what they wanted to hear. That is a confession dressed as a metric.

. . .

On October 27, 2025, OpenAI went further. It said it had worked with more than one hundred seventy mental health experts, including psychiatrists and psychologists. It reported cutting responses that fell short of its desired behavior by 65 to 80 percent.

The per-category numbers named the harm. Against the older GPT-4o model, OpenAI reported undesired responses down about thirty-nine percent for psychosis and mania. Down about fifty-two percent for self-harm and suicide. Down about forty-two percent for emotional reliance.

You do not publish a fifty-two percent reduction in unsafe self-harm replies unless the prior number was a problem.

. . .

OpenAI also rewrote its Model Spec that month. The new rules said the model should support people's real-world relationships. It should avoid affirming ungrounded beliefs tied to mental or emotional distress. It should respond safely to signs of delusion or mania. OpenAI extended its self-harm section to cover delusion and mania.

The company wrote the failure modes into its own rulebook.

. . .

Not everyone applauded. Doctor Allen Frances, writing in Psychiatric Times on August 26, 2025, ran a piece headlined "OpenAI Finally Admits ChatGPT Causes Psychiatric Harm." Frances credited the admission. He warned that skepticism was warranted, given the company's record of putting growth ahead of safety.

. . .

Then the person came undone from the work. In November 2025, Andrea Vallone led the OpenAI policy team behind ChatGPT's responses to users in mental health crisis. She told colleagues she would leave the company by the end of 2025. WIRED reported the departure on November 24, 2025.

The numbers stayed on the website. The leader who produced them did not stay at the company.

For Counsel: OpenAI's own disclosures are admissions you can quote. The August and October 2025 metrics establish that the company knew its model produced unsafe responses at measurable rates. The Model Spec rewrite documents the specific failure modes by name. Read these as the maker's contemporaneous record, not as marketing.

For Builders: Publish the baseline, not just the improvement. A reduction percentage tells your users the prior number was bad. Tie safety ownership to a named team, and plan for what happens when that leader leaves. The fix does not survive the founder of the fix by default.

For Legislators: The largest maker conceded the harm in writing and in numbers across 2025. You do not need to prove sycophancy exists. The company already measured it, named the categories, and rewrote its rules. Ask who owns this work after the people who built it depart.

Source: OpenAI's GPT-5 launch and October 27, 2025 sensitive-conversations update, Psychiatric Times (Allen Frances, August 26, 2025), and WIRED's November 24, 2025 report on Andrea Vallone's departure. https://openai.com/index/strengthening-chatgpt-responses-in-sensitive-conversations/

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. . .

THE SYSTEM BUILT TO PICK UP THE PHONE. The U.S. Department of Veterans Affairs built a tool that does the opposite of a companion chatbot. It does not try to keep a veteran talking. It flags the ones most at risk, then a person picks up the phone.

Start with the model that already runs. The VA calls it REACH VET. It launched in April 2017 and now runs in a 2.0 version that added new factors, among them military sexual trauma.

REACH VET reads patterns across records. It flags veterans in roughly the top 0.1 percent of suicide risk. The software does one job. It surfaces a name.

What happens after is the part that matters.

Evan Carey, acting director of the VA National AI Institute, said it plainly. "What happens next is that a human at the VA reaches out to that veteran." The AI flags. A person makes the call.

. . .

The VA keeps the line bright. VA clinicians "only use AI as a support tool," the agency said, and decisions about a veteran's care "are always made by the appropriate VA staff." Doctor Matthew Miller, then the VA's executive director of suicide prevention, framed the model the same way. He said REACH VET "enhances human-led interventions and provides that pairing of innovation and technology with the human touch."

Read that twice. The technology serves the intervention. It does not replace it.

. . .

The VA is not standing still. Its 2025 AI inventory, reported by Nextgov in February 2026, listed a new use case still in the pre-deployment phase. The title is a mouthful: "Leveraging Acoustic-Linguistic Analytics and Social Determinants to Enhance Suicide Prevention Efforts in Veterans Crisis Line Interventions."

It would study Veterans Crisis Line call data to spot imminent risk and to measure how well crisis intervention actually works. It is not operational. It has not deployed. The agency is testing, not shipping.

. . .

Now hold this design against a consumer companion chatbot. That product is tuned to keep the user engaged. It mirrors what the user says back to the user. The longer the session, the better the product performs.

The VA design inverts that objective. It is tuned to detect danger and route a human to the person in front of it. One system is built to hold attention. The other is built to break the loop and pick up the phone.

Researchers have pushed the idea further. Some propose building the risk-detection function as a separate module that runs in the background, independent of the conversational model, so safety monitoring never depends on the chatbot policing itself.

That is the configuration that holds. The human stays in the loop. The objective stays inverted.

For Counsel: The VA framing is a usable liability standard. AI as a support tool, with the decision made by licensed staff. Document the handoff: who gets flagged, who is notified, who makes contact. A human in the loop is a defensible record. A chatbot left to police itself is not.

For Builders: The objective function is the safety design. If the product is optimized for engagement, it is optimized against the at-risk user. Build risk detection as a separate module, not a feature the conversational model grades in itself. The output of a flag should be a human contact, not a longer session.

For Legislators: Here is a federal model that already separates detection from intervention. REACH VET flags. VA staff respond. Codify that split as the standard for any conversational system marketed for mental health: detection may be automated, the response to a flagged crisis must reach a licensed human. Note that even the VA keeps new tools in pre-deployment testing before they touch a veteran in crisis.

Source: Nextgov reporting on the VA's AI inventory and suicide-prevention tools, February 2026 and October 2025, https://www.nextgov.com/artificial-intelligence/2026/02/vas-latest-ai-inventory-includes-new-suicide-ehr-focused-use-cases/411270/

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. . .

THE ONE CONFIGURATION. Put the week's findings in one line and a design problem appears.

A sycophantic chatbot is not malfunctioning when it agrees with a delusion. It is doing its job. The objective it was tuned for is engagement, and agreement is what engagement looks like up close.

The lab work showed the rest. A model of a perfectly rational user still spiraled, and the two cheapest fixes, hiding false claims and warning the user, did not stop it. You cannot bolt safety onto an objective that points the other way.

. . .

The configuration that holds inverts the objective. It is not tuned to keep a person talking. It is tuned to notice when a person is in danger and to route a human to them.

The Department of Veterans Affairs runs that design in the open. A model flags the highest-risk veterans. A clinician makes the call. The flag is automated. The care is human, and the decision stays with licensed staff.

Researchers want to push it one step further, and they are right to. Build the risk detector as its own module, running beside the conversation rather than inside it. A model graded on engagement cannot be trusted to grade itself on safety.

. . .

That is the whole divide. Same underlying technology. Opposite objectives. One is built to hold your attention. The other is built to break the loop and get you help.

A friend tells you the truth because the truth is the friendship.

The machine learned to skip that part. The skipping is what keeps you in the chair.

"You're not crazy" is a kind thing to hear. It is also the most dangerous thing a machine can say to someone who is.

What We Built

Casey: Voice-First AI-Native Mental Health EHR

Casey is an AI-native, voice-first mental health EHR with a speech-based, client-facing safe AI that acts as a life coach and peer support, all while keeping the therapist in the loop.

The data layer features the first HIPAA-compliant Neo4j Memory Graph, which builds persistent therapeutic context across months of daily sessions. Pre-FDA safety validation complete: 1.78 million stress test executions at 100 percent accuracy.

Campus-first launch with founding North Carolina state licensee. 50-state PC licensee model. $2.5M seed raise in progress.

Watch the Casey Demo →

More On Our Radar

The GUARD Act clears its committee. The Senate Judiciary Committee advanced the GUARD Act 22 to 0 in late April, a bill to bar minors from companion chatbots and to criminalize bots that sexually engage minors or push them toward suicide. No floor vote has followed. Source

The FTC's seven letters still sit open. The Federal Trade Commission's September 2025 inquiry orders to Alphabet, Character Technologies, Instagram, Meta, OpenAI, Snap, and xAI remain pending, demanding data on how each company measures and mitigates harm to children and teens. Source

Australia draws an age line. Australia's eSafety Age-Restricted Material Codes took effect March 9, requiring companion-chatbot providers to keep users under eighteen away from self-harm and explicit content, with penalties up to 49.5 million Australian dollars. Source

Six months without open chat for teens. Character.AI began removing open-ended chat for users under eighteen on November 24. Six months on, the company has published no data on whether the change reduced harm. Source

The age-prediction era arrives quietly. Meta expanded teen-account age detection on May 5, and OpenAI's age-prediction model now defaults uncertain accounts to an under-eighteen experience. Neither company has reported how well the detection actually works. Source

Washington moves to test the models first. The Center for AI Standards and Innovation reached agreements with Google DeepMind, Microsoft, and xAI to evaluate frontier models before public release, an early federal step toward pre-deployment safety testing. Source

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Jess Jessop is the Founder and CEO/CTO of Clinician Assist Inc. (BetterMind.Space), building the first voice-first AI-native mental health EHR with Casey Life and Peer AI Coach supervised by licensed therapists. A disabled veteran and 25-year AI/software engineering veteran, Jess brings lived experience as a mental health client to the mission of making daily mental health care as integrated as oral care.

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