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U.S. lawmakers are advancing a legislative push to evaluate the impact of artificial intelligence (AI) on the financial services and housing industries. Representative Maxine Waters, alongside House Financial Services Committee Chair Patrick McHenry, introduced a bill mandating federal regulators to study the current and potential benefits and risks of AI in these sectors.
The proposed AI Act of 2024 calls on regulators, including the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC), to examine how AI is being used to combat financial crimes such as money laundering, cybercrime, and fraud. Representative Waters emphasized the growing influence of AI in areas like mortgage lendingand credit scoring, highlighting the necessity for a comprehensive regulatory framework.
Chair McHenry, a co-sponsor of the bill, expressed the importance of harnessing AI’s potential while safeguarding consumers and financial markets. “These measures are crucial steps toward enabling the financial system to fully benefit from artificial intelligence, ensuring innovation while maintaining trust and security,” McHenry stated.
The legislation also underscores the use of AI-powered tools in market surveillance and tenant screening, and raises questions about privacy laws as data-driven AI becomes more prevalent. McHenry’s resolution suggests the House Financial Services Committee may explore reforms to better address privacy concerns in an AI-driven landscape.
These efforts build on the foundation laid by the Bipartisan AI Working Group, launched by the House Financial Services Committee earlier this year. Comprising both Democratic and Republican members, the group aims to guide policy discussions around AI and its implications for the financial ecosystem.
The legislative initiative aligns with President Joe Biden’s executive order issued on October 30, 2023, which seeks to promote the “safe, secure, and trustworthy development” of AI technologies in the United States. Both lawmakers hope these steps will solidify the U.S.’s leadership in AI development and application.
By encouraging informed oversight, the proposed studies aim to balance AI’s transformative potential with robust protections for consumers and businesses in the financial and housing sectors.
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