WASHINGTON — Reps. Patrick McHenry, R-N.C. and Maxine Waters, D-Calif., respectively the chairman and ranking member of the House Financial Services Committee, have introduced two bills that address growing use of artificial intelligence in the banking system.
The first of the two bills would require that financial regulators carry out studies on AI and draft a report on the usage of the technology in banks.
The second is a resolution bill — one that expresses the will of the committee rather than establishing binding requirements — that acknowledges the growing use of AI in the banking industry, as well as its risks and benefits. The resolution codifies some of the takeaways from the
“These bills are a small, but critical, step forward to empower the financial system to realize the numerous benefits artificial intelligence can offer for consumers, firms, and regulators,” McHenry said in a statement.
That working group gave few clues about what the bipartisan consensus regarding AI in financial services is and what a more substantive piece of legislation might look like, though it did say that the House Financial Services Committee should “explore the potential benefits of a chief AI officer at each financial regulator.”
While the two bills are limited in scope, they represent a starting point between Waters — who is widely expected to remain the panel’s ranking member in the next Congress — and the committee’s yet-to-be-named Republican chairman. McHenry is retiring when the 118th Congress concludes.
“Our committee will continue to collaborate closely with the federal government to identify the risks and benefits of AI and to explore further legislation needed to protect people and our communities,” Waters said in a statement. “I look forward to passing these bills and continuing to work in a bipartisan manner on this important issue next Congress.”
The pair of bills come before the House Financial Services Committee is set to hear from industry participants on Wednesday at a hearing on innovation in the financial industry.
Bank regulators will consider how to regulate AI in the financial system during the Trump administration. Federal Reserve Gov. Michelle Bowman, a Trump appointee,
“We should avoid fixating on the technology and instead focus on the risks presented by different use cases,” she said in a Friday speech. “These risks may be influenced by a number of factors, including the scope and consequences of the use case, the underlying data relied on, and the capability of a firm to appropriately manage these risks.”
Sen. Mike Rounds, R-S.D., has proposed a
“The oversight coming from the agencies is one that says, ‘OK, here’s what we want to pursue,’ so it’s a joint venture, so to speak, and everybody wins,” Rounds said in comments last week. “You want them to offer these products and services to you, but if they’re restricted because of regulatory oversight — this is not allowed, we don’t know how to do that — then we’ll never get ahead, and other people in other countries will do this to us.”