As part of a sweeping action revoking multiple Biden-era policies, President Trump yesterday rescinded a 2023 executive order directing federal agencies to review and possibly draft new rules governing the use of artificial intelligence across multiple sectors of the economy, including financial services. Trump also rescinded a 2021 executive order seeking more disclosure of financial risks linked to climate change.
Among other things, the order by former President Biden encouraged agencies to use their authority to address financial stability risks posed by AI. It also required the developers of many AI systems to share their safety test results and other critical information with the U.S. government, set standards and best practices for detecting AI-generated content as a tool for fighting consumer fraud, and establish an “advanced” cybersecurity program to develop AI tools to find and fix vulnerabilities in critical software.
Some parts of the Biden-era order have already been completed. For example, it directed the Treasury Department to submit a report on best practices for financial institutions to manage cybersecurity risks posed by AI. The report was released in 2024. Trump did not revoke a more recent order by Biden directing government agencies to update their IT and cloud services policies to strengthen cybersecurity.
The 2021 order on climate change directed government agencies to push for “accurate disclosure of climate-related financial risk,” and directed financial regulators to consider measures to enhance climate-related disclosures.
