U.S. Sens. Elizabeth Warren (D-MA), ranking member of the Senate Committee on Banking, Housing and Urban Affairs, is urging regulators to rescind updated policies she said leaves American banks vulnerable to cyberattacks and AI-enabled attacks.
In a letter to Fed Vice Chair for Supervision Michelle Bowman, Federal Deposit Insurance Corporation Chairman Travis Hill, and Comptroller of the Currency Jonathan Gould, Warren warned that updated supervisory policy and rules governing bank examiners’ ability to issue warnings, leaves the American banking system more vulnerable to attacks.
“This policy is especially harmful at a time when AI-enabled cyberattacks are intensifying and placing critical financial infrastructure at risk. As advancements in frontier AI increasingly enable bad actors to conduct cyberattacks, the Fed should be strengthening bank examiners’ supervisory tools and their ability to enforce strong cybersecurity standards, not gutting them,” Warren wrote. “I write to request that you immediately rescind this policy.”
Warren said the Fed’s new policy and the FDIC and OCC’s final rule narrowly an “unsafe or unsound” practice which could prevent examiners from taking enforcement or supervisory actions related to unsafe cybersecurity practices. The updated policy and the banking rule are inadequate in protecting the nation’s financial system, she said, especially in a time when cyber threats are rapidly evolving.
“The proliferation of AI tools that expedite phishing attempts or aid in exploiting vulnerabilities is increasingly subjecting financial institutions and their third-party vendors to cyberattacks,” she wrote. “The potential consequences of sophisticated attacks on the financial system include operational disruption and data compromise.”