Well, actually, the words are most likely being filtered, but you can't really tell with only one user in the room.  The reason is this:  the person typing the "dirty words" will actually see their words on the screen, like "dang", "darn", etc. but OTHER people will NOT.  The OTHER people (users in the chatroom) will only see **** instead of the dirty word.  It is kind of confusing and we are working on clearing up that confusion.  However, if this doesn't answer your question, and you are still seeing problems with this feature, please open a ticket with our helpdesk:  support@swirlhost.com , and we'll make sure the problem gets corrected.  Thanks!