News & Analysis as of

Broker-Dealer Artificial Intelligence

Skadden, Arps, Slate, Meagher & Flom LLP

How and When SEC Recordkeeping Rules May Apply to AI-Generated Content

AI has revolutionized the way many businesses operate. Firms in the financial sector are eager to take advantage of rapidly developing technologies but do not want to risk running afoul of relevant Securities and Exchange...more

Morrison & Foerster LLP

Significant Investment Adviser Regulatory Developments in 2024

Alongside the rapid pace of Securities and Exchange Commission (SEC) rulemaking, the SEC and its Staff continue to shape regulatory obligations for investment advisers in 2024 through guidance, alerts, enforcement actions,...more

Goodwin

EU AI Act: Key Points for Financial Services Businesses

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The European Union (EU) Artificial Intelligence Act (AI Act), Regulation (EU) 2024/1689 of the European Parliament and of the Council of 13 June 2024 laying down harmonised rules on artificial intelligence and amending...more

Alston & Bird

Navigating AI-Related Disclosure Challenges: Securities Filing, SEC Enforcement, and Shareholder Litigation Trends

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Companies’ accelerating reliance on artificial intelligence (AI) means heightened Securities and Exchange Commission (SEC) and shareholder plaintiff scrutiny. Our Securities Litigation Group underscores what companies need to...more

Katten Muchin Rosenman LLP

Privacy, Data and Cybersecurity Quick Clicks | Issue 19

Katten's Privacy, Data and Cybersecurity Quick Clicks is a monthly newsletter highlighting the latest news and legal developments involving privacy, data and cybersecurity issues across the globe....more

Orrick, Herrington & Sutcliffe LLP

SEC to issue second rounds of NPRM for RIA custody rule and AI rule

On July 8, the SEC issued a statement on the Spring 2024 Regulatory Agenda from Chair Gary Gensler. Notably, the SEC updated two rules that will be slated for a second round of proposed rulemaking. First, the SEC will...more

Mayer Brown Free Writings + Perspectives

SEC Investor Advocate Report on Objectives

The Securities and Exchange Commission’s Office of the Investor Advocate recently issued its fiscal year 2025 Report on Objectives. The Report is one of two annual reports required to be filed by the Investor Advocate with...more

Orrick, Herrington & Sutcliffe LLP

FINRA issues guidance on broker-dealers using generative AI tools

On June 27, FINRA issued Regulatory Notice 24-09 that discussed the implications to broker-dealers in their use of artificial intelligence (AI), including large language models (LLMs) and other generative AI tools. Although...more

Paul Hastings LLP

Public Company Watch: June 2024

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In the June edition of our Public Company Watch, we cover key issues impacting public companies, including the recent SEC staff statement on cybersecurity disclosures in Form 8-K, structural defenses against shareholder...more

Carlton Fields

Expect Focus - Volume II, May 2024

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Last Lap in SEC RILA Rulemaking Critical Unresolved Issues - Congress directed the SEC to adopt a new registration statement for registered indexed annuities (RILAs) by the end of June. Several months ago, the SEC...more

Carlton Fields

Cinch Up! AI Enforcement Starts With Washing Charges

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In March 2024, the SEC announced that it settled two cases against investment advisers Delphia (USA) Inc. and Global Predictions Inc. for making false and misleading statements about their purported use of artificial...more

Eversheds Sutherland (US) LLP

Dual registrant regulatory roundup - May 2024

Welcome to the Regulatory Roundup. Each month, Eversheds Sutherland Investment Services attorneys review significant regulatory developments (including notable rulemakings and guidance from securities regulators) from the...more

Paul Hastings LLP

Public Company Watch: April 2024

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In the April edition of our Public Company Watch, we cover key issues impacting public companies, including the SEC’s recent enforcement action regarding “AI Washing,” the SEC’s recent shadow trading case, proposed amendments...more

Davis Wright Tremaine LLP

AI for IAs: How Artificial Intelligence Will Impact Investment Advisers

The use of artificial intelligence and machine learning technology solutions ("AI") is becoming increasingly common in all industries, including the registered investment adviser ("RIA") space. A recent survey by AI platform...more

Royer Cooper Cohen Braunfeld LLC

Advisers and AI

Earlier this year, the SEC, NASAA, and FINRA issued an Investor Alert cautioning investors about the rise of investment fraud involving artificial intelligence (AI) and other emerging technologies. The overarching concern:...more

SEC Compliance Consultants, Inc. (SEC³)

Compliance Roundup for April 5, 2024

Compliance Update for the week Ending April 5, 2024 - For our clients and compliance colleagues, this weekly update will give you a quick look at the latest regulatory developments. Enjoy!...more

Bilzin Sumberg

SEC Issues First AI-Related Civil Penalties and Warns Against “AI Washing”

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​​​​​​​The Securities and Exchange Commission on Monday, March 18, 2024, entered into settlements with Delphia (USA) and Global Predictions, which agreed to pay civil penalties totaling $225,000 and $175,000, for “AI...more

Wilson Sonsini Goodrich & Rosati

SEC Actions Highlight Focus on the Use of AI by Investment Advisers

Two settlement orders involving claims by investment advisers regarding their use of artificial intelligence (AI), both announced on the same day, underscore the continued focus on advisers' use of AI by the U.S. Securities...more

Wiley Rein LLP

SEC Chairman Critiques AI: Compares Faulty AI to "Hallucinogenic Mushrooms" and Predicts Regulation and Oversight

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Federal regulators continue to target Artificial Intelligence (AI), using colorful rhetoric to signal skepticism and justify regulatory oversight. In recent remarks addressing the use of AI in financial markets, SEC Chairman...more

Mayer Brown Free Writings + Perspectives

Artificial Intelligence, the Movies and Hallucinations

In recent wide-ranging remarks punctuated with a number of movie references and analogies (some that I confess were lost on me), Securities and Exchange Commission Chair Gensler spoke about various aspects of Artificial...more

Orrick, Herrington & Sutcliffe LLP

SEC Chair Gensler weighs in on AI risks and SEC’s positioning

On February 13, SEC Chair Gary Gensler delivered a speech, “AI, Finance, Movies, and the Law” before the Yale Law School. In his speech, Gensler spoke on the crossovers between artificial intelligence (AI) and finance,...more

Goodwin

FINRA Publishes 2024 Annual Regulatory Oversight Report

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On January 9, 2024, FINRA published its 2024 Annual Regulatory Oversight Report (the “Report”). FINRA publishes the Report as a way to provide its broker-dealer members with insight into findings from FINRA’s Member...more

WilmerHale

FINRA’s 2024 Annual Regulatory Oversight Report: What Broker-Dealers Need to Know

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On January 9, 2024, the Financial Industry Regulatory Authority published its 2024 FINRA Annual Regulatory Oversight Report. Previously titled Report on FINRA’s Examination and Risk Monitoring Program, the Report is released...more

BakerHostetler

SEC’s Scrutiny of AI Expands to Marketing Disclosures and Adviser Exams

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Chair Gensler Continues to Be Outspoken About the Risks of AI Technologies - Chair Gensler’s warnings of the potential risks associated with the use of AI technologies in the securities industry recently continued with...more

White & Case LLP

Navigating New Frontiers in Regulatory Enforcement: the SEC Increases Scrutiny of Artificial Intelligence

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The SEC is Keeping a Watchful Eye on Companies' Claims about their AI Capabilities and Issued a Recent Warning: Don't "AI-Wash" - In July 2023, the SEC proposed new rules that would require broker-dealers and investment...more

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