The U.S. Department of the Treasury released a report that offers recommendations based on the feedback from a request for information (RFI) on the Uses, Opportunities, and Risks of Artificial Intelligence (AI) in Financial Services.
The report discussed the increasing use of AI and generative AI throughout the financial services sector. It also underscored AI’s potential to broaden opportunities while amplifying certain risks, such as risks related to data privacy, bias, and third-party providers.
“Through this AI RFI, Treasury continues to engage with stakeholders to deepen its understanding of current uses, opportunities, and associated risks of AI in the financial sector,” Under Secretary for Domestic Finance Nellie Liang said. “The Biden Administration believes that continued stakeholder engagement like this is important to fostering innovation in financial services while mitigating potential risks.”
In addition, it outlined potential next steps to be considered by the Treasury, government agencies, and the financial services sector. The recommendations include:
- Continuing international and domestic collaboration among governments, regulators, and the financial services sector to promote consistent and robust standards for uses of AI in the financial services sector;
- Further analysis and stakeholder engagement to explore solutions for any gaps in the existing regulatory frameworks, and to address the potential risk of AI causing consumer harm;
- Coordination among financial regulators to identify potential enhancements to existing risk management frameworks and collaboration between government agencies to clarify supervisory expectations on the application of frameworks and standards, where appropriate;
- AI information sharing, alongside the AI cybersecurity forum recommended in Treasury’s AI Cybersecurity report, to develop data standards, share risk management best practices, and enhance understanding of emerging AI technologies in financial services; and
- Prioritizing the review of AI use cases by financial firms for compliance with existing laws and regulations before deployment.
The AI RFI was on June 12, 2024. It received 103 comment letters in response from a variety of stakeholders, including financial firms, consumer advocacy groups, technology providers, financial technology companies, trade associations, and consulting firms.