Top lawmakers on the House Financial Services Committee are using this congressional term to address the impact of artificial intelligence on the finance and housing industries.
Reps. Patrick McHenry, R-N.C., and Maxine Waters, D-Calif., chair and ranking member of the committee, respectively, announced Monday the introduction of a resolution recognize the growing use of AI in financial services and the housing sector, as well as a Invoice which calls on financial regulatory agencies to study the benefits of technology within the sector.
The resolution and bill are the culmination of nearly a year of work by the committee. bipartisan task force on AI and come a few days before audience which will explore how technology is shaping the future of finance.
“Artificial intelligence promises to revolutionize our financial system”, McHenry said in a statement. “As businesses increasingly leverage AI, lawmakers and regulators charged with overseeing the financial services industry must continually evaluate the risks and benefits this technology presents. These bills are a small but crucial step forward in enabling the financial system to realize the many benefits that artificial intelligence can provide to consumers, businesses and regulators.
The resolution, introduced by McHenry and co-sponsored by Waters, outlines the House Financial Services Committee’s responsibilities regarding AI, covering everything from how real estate market participants leverage technology for tenant underwriting and screening to examining how financial institutions use AI could increase herding behavior in markets.
The committee, McHenry and Waters write in the resolution, will ensure that financial regulatory agencies exercise their enforcement powers and have the appropriate tools to do so as the use of AI across industries proliferates. They will also consider reforming data privacy laws “given the importance of data, particularly consumer data, to AI,” work with regulators on the impact of AI on hand We will work hard and do everything we can to ensure that the United States leads the world in development. and the use of AI in industries.
“Artificial intelligence is growing rapidly and people across America are already seeing its use in our nation’s housing and financial services sectors, with impacts on mortgage lending, credit scoring and much more” , Waters said in a statement. “Our committee will continue to work closely with the federal government to identify the risks and benefits of AI and to explore other legislation needed to protect people and our communities.”
The Analysis and Improvement Act of 2024 – or the AI Act of 2024 – would require the Federal Reserve, the Federal Deposit Insurance Corp., the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau and the National Credit Union Administration to provide a report to the House Financial Services Committee that examines various AI-related issues in the agencies’ respective sectors.
These questions include the use of AI for home appraisal, loan underwriting and servicing, how banking institutions are using AI to identify fraud, money laundering and cybercrime, and how AI is used in debt collection and foreclosures. The bill also mentions how AI can alleviate bias and discrimination in banking, how the technology can level the playing field between small and large financial institutions and how it can benefit bank risk management. cybersecurity.
The bill would also require the Securities and Exchange Commission to produce a report on the risks and benefits of AI to the markets and for the Treasury Department to study the technology’s ability to protect the nation’s financial system from threats to national security.
Another provision of the bill calls on the Department of Housing and Urban Development, the Federal Housing Finance Agency, the Rural Housing Service of the Department of Agriculture and the CFPB to report on the risks and benefits of the ‘AI for housing and mortgage regulators.
“I look forward to passing these bills and continuing to work in a bipartisan manner on this important issue in the next Congress,” Waters said.