Ladies and Gentlemen:
The Bank Policy Institute[1] is writing to reply to the Office of Science and Technology Policy’s Request for Information; Regulatory Reform on Artificial Intelligence.[2] We assist and welcome the chance to contribute to OSTP’s efforts, in step with the suggestions of the July 23, 2025 AI Action Plan launched by the White House,[3] to establish priorities for federal regulatory reform and different company motion vital to promote AI innovation and adoption within the United States.[4]
BPI and its member banks are dedicated to utilizing AI responsibly of their companies and operations. As the Government Accountability Office lately famous, “[f]inancial institutions are using AI for many activities … includ[ing] automated trading, countering threats and illicit finance, credit decisions, customer service, investment decisions, and risk management.”[5]
The adoption of AI instruments within the monetary sector is at a vital inflection level. Although banks have been utilizing conventional AI and machine studying instruments for many years,[6] the emergence of generative AI, together with massive language fashions (collectively, “GenAI”), has opened the door to transformational advantages for monetary establishments. Federal Reserve Board Vice Chair for Supervision Michelle Bowman lately acknowledged that AI applied sciences “have the potential to transform how business is conducted [for banks], including the way we detect and prevent fraud, manage risk, and provide customer service.”[7] We agree.
These alternatives are rising amidst a regulatory and supervisory surroundings that usually discourages, somewhat than incentivizes, accountable AI innovation by monetary establishments. Specifically, some BPI members have skilled issue partaking with supervisors and examiners who could not admire the advantages and threat profiles of AI use circumstances. This can lead to hesitation, if not risk-aversion, throughout organizations when it comes to AI adoption.
Further, banking organizations face threats from dangerous actors who themselves use cutting-edge AI expertise to assault monetary establishments, threatening the protection and stability of banks and their prospects. In the face of these threats, banking regulators ought to regulate their expectations so as to present banks with the pliability wanted to deploy AI-based defenses shortly and safely. To date, one of probably the most extensively adopted AI use circumstances within the U.S. banking system has been to harness AI-powered applied sciences to counter the efforts of malicious overseas and home actors.[8] As the applied sciences utilized by these dangerous actors grow to be extra superior, will probably be necessary for banks to have the ability to embed AI into their defensive toolkits to most successfully fight these threats.
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[1] The Bank Policy Institute is a nonpartisan public coverage, analysis and advocacy group that represents common banks, regional banks, and the main overseas banks doing enterprise within the United States. The Institute produces tutorial analysis and evaluation on regulatory and financial coverage matters, analyzes and feedback on proposed laws, and represents the monetary companies trade with respect to cybersecurity, fraud, and different data safety points.
[2] Notice of Request for Information; Regulatory Reform on Artificial Intelligence, 90 Fed. Reg. 46,422 (Sept. 26, 2025), https://www.govinfo.gov/content/pkg/FR-2025-09-26/pdf/2025-18737.pdf (Office of Science and Technology Policy).
[3] Winning the Race: America’s AI Action Plan, THE WHITE HOUSE (July 2025), https://www.whitehouse.gov/wp-content/uploads/2025/07/Americas-AI-Action-Plan.pdf (the “AI Action Plan”).
[4] This doc is accepted for public dissemination. The doc comprises no business-proprietary or confidential data. Document contents could also be reused by the federal government in creating the AI Action Plan and related paperwork with out attribution.
[5] Artificial Intelligence: Use and Oversight in Financial Services, UNITED STATES GOVERNMENT ACCOUNTABILITY OFFICE REPORT TO CONGRESSIONAL COMMITTEES (May 19, 2025), https://www.gao.gov/assets/gao-25-107197.pdf (“GAO AI Report”).
[6] The integration of AI within the type of machine studying inside the monetary sector traces its origins to the Eighties, when it was employed primarily to establish and counteract fraudulent actions. Okay. W. Kindle, R. S. Cann, M. R. Craig, and T. J. Martin, PFPS – Personal Financial Planning System – AAAI, in Proceedings of the Eleventh National Conference on Artificial Intelligence, pp. 344-349, 1989.
[7] Vice Chair Michelle Bowman, Embracing Innovation, Remarks on the Wyoming Blockchain Symposium 2025, FEDERAL RESERVE (Aug. 19, 2025), https://www.federalreserve.gov/newsevents/speech/bowman20250819a.htm.
[8] See, e.g., GAO AI Report, supra observe 5 at 11 (“AI could improve the security of institutions and markets through better detection of cyber threats and illicit finance … For example, AI can help combat synthetic identity fraud by identifying cases that human analysts cannot easily detect.”); Report on Artificial Intelligence, BIPARTISAN H. TASK FORCE ON ARTIFICIAL INTELLIGENCE, 118th Cong., at 235 (Dec. 2024), https://republicans-science.house.gov/_cache/files/a/a/aa2ee12f-8f0c-46a3-8ff8-8e4215d6a72b/6676530F7A30F243A24E254F6858233A.ai-task-force-report-final.pdf (discussing how monetary establishments are utilizing AI for buyer identification verification and detecting suspicious exercise); AI Innovation Explored: Insights into AI Applications in Financial Services and Housing, Staff Report, BIPARTISAN WORKING GROUP ON ARTIFICIAL INTELLIGENCE, H. COMM. ON FIN. SERVS., 118th Cong., at 15 (July 18, 2024), https://financialservices.house.gov/uploadedfiles/bipartisan_working_group_on_ai_staff_report.pdf (noting that fraud detection has been a number one AI use case within the banking trade).