Man arrested for producing, distributing, possessing AI-generated child sexually explicit content

By Enjoyiana Nururdin, M.A.

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    LA CROSSE, Wisconsin (WKOW) — A Wisconsin man was charged by the United States of America for crimes relating to inappropriate AI-generated images of children, the Department of Justice released Monday evening.

Steven Anderegg, 42, of Holmen, Wisconsin, was arrested on four counts relating to the production, distribution, and possession of sexually explicit content featuring AI-generated children.

If convicted of all four counts alleged in the indictment, he faces a total statutory maximum penalty of 70 years in prison and a mandatory minimum of five years in prison. He remains in federal custody pending a detention hearing scheduled for May 22.

Anderegg, who has years of experience and a college education in computer science, used a text-to-image generative AI model called Stable Diffusion (produced by Stability AI) to create hyper-realistic images of nude and semi-clothed prepubescent children showing or touching their genitals, or engaging in sexual intercourse, with adults.

The investigation into AI-child pornographic images led to an additional investigation into the first-degree sexual assault of a child under the age of 13. Anderegg is released on bond for that case, where he faces three charges, including two felony charges of child exposure to harmful material.

“Technology may change, but our commitment to protecting children will not,” said Deputy Attorney General Lisa Monaco. “The Justice Department will aggressively pursue those who produce and distribute child sexual abuse material—or CSAM—no matter how that material was created. Put simply, CSAM generated by AI is still CSAM, and we will hold accountable those who exploit AI to create obscene, abusive, and increasingly photorealistic images of children.”

According to court documents, Anderegg shared images of that nature with a teenage boy, and others, through Instagram Direct Messages, and the encrypted-mobile messaging app, Telegram in 2023.

During the fall of last year, law enforcement in Wisconsin received two tips from CyberTips from The National Center for Missing and Exploited Children advising that user on the “Subject Account” on Instagram, later identified as Anderegg, was sharing information on how to evade AI detection, and sending AI-generated images of naked minors, allegedly knowingly including to a potential minor. An investigation found that Anderegg had posted an Instagram story of a GenAI image of minors wearing BDSM-themed leather clothes and a message encouraging others to “check out what they’re missing,” on Telegram.

According to the DOJ, Anderegg’s messages confirmed that he has a wife and child, and showed that he discussed his desire to have sex with underage boys. In one message thread, another user asked Anderegg for nude images of minors, and Anderegg allegedly advised that he “has tons of images like that” on Telegram before passing along more information.

In another message, Anderegg explained that he does not publicly post fully nude images of minors on Instagram, because “that would be illegal” and subsequently discussed how he gets around it.

The investigation also surfaced messages between Anderegg and a potential minor. After being questioned by Anderegg, it was revealed that the potential minor was indeed a 15-year-old male. Anderegg then explained, unprompted, how he created the images by inputting text prompts into the generative AI model. He then allegedly sent unsolicited images of semi-clothed minor boys.

“As alleged, Steven Anderegg used AI to produce thousands of illicit images of prepubescent minors, and even sent sexually explicit AI-generated images to a minor,” said Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division.

This wasn’t the first time Anderegg was caught with obscene, sexual images of a child, AI or not. In 2020, law enforcement observed that someone using the internet at Anderegg’s home was requesting to download multiple files on known child sexual abuse material over an online peer-to-peer network. During the investigation, Anderegg admitted to using and deleting the program and resetting his modem. No charges were brought relating to that investigation, but in February of this year, law enforcement executed a warrant on Anderegg’s home, and they searched his home office.

Law enforcement found a work computer, which showed that he works as a software engineer, and his personal laptop, which had Stable Diffusion, and a graphical user interface with mods and tools that generate photo-realistic images of minors. Anderegg allegedly had over 13,000 GenAI images, with hundreds, if not thousands, according to the DOJ, of images inappropriately depicting minors touching what appeared to be adult genitalia, or engaging in sexual intercourse.

The investigation also showed that Anderegg used “extremely specific and explicit prompts” to create the images in a way that would avoid creating images that depicted adults.

“Today’s announcement sends a clear message: using AI to produce sexually explicit depictions of children is illegal, and the Justice Department will not hesitate to hold accountable those who possess, produce, or distribute AI-generated child sexual abuse material,” Deputy Assistant Attorney General Argentieri continued.

Despite having no prior convictions, the DOJ suggests that Anderegg poses an immense threat to the community. They also suggest that his motivation is a sexual interest in children, specifically minors. The DOJ also notes that his technological know-how is a danger given the lack of regulation in AI and socially-protected and encrypted spaces, specifically Meta and Telegram:

“[Anderegg’s] background provides ample reason to conclude that he could sidestep such restrictions if he decided to. And if he did, any reoffending conduct would likely go undetected… despite the scope of his apparent crimes, [Anderegg] was only caught because Instagram detected and reported that he sent a 15-year-old boy obscene images of minors engaged in a sexually explicit conduct by direct message on a single day in October 2023.”

In addition to the charges, DOJ suggested that Anderegg should at least be subject to computer and GPS monitoring, and prohibited from having any contact with minors.

Trial Attorney William G. Clayman of the Criminal Division’s Child Exploitation and Obscenity Section (CEOS) is prosecuting the case with assistance from the U.S. Attorney’s Office for the Western District of Wisconsin.

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