China Investigates DeepSeek and Moonshot Over Sending User Data to Claude Without Disclosure

By Carlos Montiel | Enterprise AI Specialist
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Published: 2026-09-22 | By: Carlos Montiel | Reading time: ~6 min

China's Cyberspace Administration (CAC) is investigating DeepSeek and Moonshot AI (maker of the Kimi assistant) over allegations they routed real requests from Chinese users to Claude, the model built by US-based Anthropic, without those users' knowledge. It's a story with a striking twist: the usual regulatory worry in AI is data flowing OUT of the West and into China, not the other way around.

How it was uncovered

According to reports, the case started on Anthropic's side: the company was monitoring attempts by rival companies to use Claude to train or improve competing models (a "distillation" practice several labs actively watch for), and in that process it identified large-scale activity linked to DeepSeek and Moonshot. CAC officials have already visited both companies' offices to interview executives and employees.

The scale: this wasn't an isolated incident

Claude interactions attributed by Anthropic (per reports): - Combined total: over 35 million - Moonshot (Kimi): over 23 million - DeepSeek: over 12 million

The most sensitive part of the case: according to Anthropic, in at least some instances Moonshot forwarded genuine requests made by real Kimi users to Claude for processing — meaning people using what they believed was a 100% Chinese assistant unknowingly ended up with their query processed by a US AI system.

Why this is sensitive right now

The timing isn't coincidental: the investigation surfaced ahead of US-China AI talks at the Trump-Xi level. A case of Chinese user data reaching a US provider without consent is exactly the kind of finding that could harden China's regulatory stance on which foreign models can be used — even indirectly — inside Chinese consumer products.

The lesson for any company using third-party AI

Beyond the geopolitics, this case is a concrete reminder of a risk any company should audit in its own AI products: do you actually know which provider(s) your users' data ends up reaching when your product uses a third-party AI model — especially if that provider in turn routes or falls back to ANOTHER model under the hood? Fallback routing between providers without disclosing it explicitly in your terms of service isn't just a regulatory problem in China — it's exactly the kind of transparency gap any enterprise client (banking, healthcare, government) demands the ability to audit before signing an AI contract.
Carlos Montiel
Enterprise AI Solutions Architect
LLMs, Agents & Orchestration Specialist
guatemalia.com/#contacto · info@guatemalia.com

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Carlos Montiel is an enterprise AI solutions architect. He implements LLMs, Agents, RAG and orchestrators for companies across Guatemala and Latin America. Reach out for a consultation.

Contact Carlos Montiel

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