The American Bankers Association today submitted a list of principles to guide any legislation relating to artificial intelligence in financial services, stressing that Congress must pass comprehensive laws establishing an AI risk management framework with strong preemption of state requirements.
In a statement submitted to the House Financial Services Committee ahead of a hearing on AI in financial services, ABA noted that banks already are subject to an extensive compliance regime covering nearly all risks associated with AI, including fair lending and cybersecurity requirements. Therefore, any new federal laws must not impose duplicative or inconsistent requirements, the association said.
ABA also warned about the ongoing risk that states will adopt laws governing AI that stifle innovation by imposing conflicting and unnecessary requirements on financial institutions. “In some cases, these laws could impact the way many financial institutions have used AI for the last several decades,” it said.
ABA outlined five general principles to guide legislation on AI:
- Avoid a patchwork of state laws and regulations.
- Acknowledge the current legal and regulatory framework for financial services.
- Support field examination reform by the banking agencies so that supervisors focus on substantive risks rather than technical minutiae.
- Fight fraud and cybercrimes by creating stronger penalties for the use of AI in criminal activities while also acknowledging the role the technology can play in combating fraud.
- Encourage the development of voluntary strategies for managing AI-related risks, such as the AI Centers of Excellence proposed by the Trump administration.
