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Saul Ewing LLP

CFPB and Other Federal Agencies Enact New Rule to Regulate Use of Automated Valuation Models for Mortgage Transactions

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On July 1, 2024, the Consumer Financial Protection Bureau (“CFPB”)—the primary federal watchdog of the consumer finance industry—along with several other federal agencies, approved a new rule to regulate the use of automated...more

Ballard Spahr LLP

Treasury Issues Request for Information on Use of AI in Financial Services

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The U.S. Department of the Treasury (“Treasury”) has released a Request for Information on the Uses, Opportunities, and Risks of Artificial Intelligence (“AI”) in the Financial Services Sector (“RFI”).  Written comments are...more

Troutman Pepper

Troutman Pepper Weekly Consumer Financial Services Newsletter - April 2024 # 5

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To keep you informed of recent activities, below are several of the most significant federal and state events that have influenced the Consumer Financial Services industry over the past week...more

Ballard Spahr LLP

CFPB Director Chopra addresses AI concerns

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According to media reports, CFPB Director Rohit Chopra expressed his concerns over the rise of generative artificial intelligence (AI) technology in his remarks at an Axios event in Washington, D.C. last week. Director...more

Ballard Spahr LLP

Executive Order on artificial intelligence includes actions impacting consumer financial service providers

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On October 29, the Biden Administration issued a broad Executive Order (Order) on artificial intelligence (AI). Titled “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence,”...more

Jones Day

CFPB Guidance Puts Creditors on Notice About AI-Involved Adverse Actions

Jones Day on

Recent Consumer Financial Protection Bureau ("CFPB") guidance reiterates that creditors must provide consumers with accurate and individualized explanations for adverse actions—a task made more difficult by the complexity of...more

Husch Blackwell LLP

CFPB Issues New Guidance for AI-Driven Credit Decisions

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On September 19, 2023, the Consumer Financial Protection Bureau (CFPB) issued new guidance outlining lenders’ obligations under the Equal Credit Opportunity Act (ECOA) and Regulation B when using artificial intelligence (AI)...more

Ballard Spahr LLP

CFPB Revisits Adverse Action Notice Requirements When Using Artificial Intelligence or Complex Credit Models

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In May 2022, the CFPB issued Circular 2022-3 addressing Equal Credit Opportunity Act (ECOA) adverse action notice requirements in connection with credit decisions based on algorithms. The CFPB is now revisiting the issue in...more

Troutman Pepper

CFPB Calls for Increased Specificity and Accuracy on Reasons for Credit Denials When Lenders Employ Artificial Intelligence

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When using artificial intelligence (AI) or complex credit models, can lenders rely on the checklist of reasons provided in Regulation B sample forms for adverse action notices? According to today’s guidance issued by the...more

Ballard Spahr LLP

CPPA publishes new draft regulations addressing AI, risk assessments, cyber audits

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The California Privacy Protection Agency (CPPA) recently published two new sets of draft regulations addressing a range of cutting-edge data protection issues. Although the CPPA has not officially started the formal...more

Orrick, Herrington & Sutcliffe LLP

Federal agencies reaffirm commitment to confront AI-based discrimination

On April 25, the CFPB, DOJ, FTC, and Equal Employment Opportunity Commission released a joint statement reaffirming their commitment to protect the public from bias in automated systems and artificial intelligence (AI). ...more

BCLP

Does Your Current Use of AI in Financial Services Align with the U.S. “AI Bill of Rights”?

BCLP on

As OpenAI’s release of ChatGPT in late 2022 and expected release of GPT-4 in 2023 continues to garner widespread attention, there is renewed focus on both opportunities and risks presented by the use of artificial...more

Orrick, Herrington & Sutcliffe LLP

Barr says AI should not create racial disparities in lending

On February 7, Federal Reserve Board Vice Chair for Supervision, Michael S. Barr, delivered remarks during the “Banking on Financial Inclusion” conference, where he warned financial institutions to make sure...more

McGlinchey Stafford

Powersports and the CFPB: Fair lending, fees, repossessions, and voluntary products

McGlinchey Stafford on

Compliance lawyers last summer were predicting that the Consumer Financial Protection Bureau (CFPB) would announce a robust regulatory agenda under the Biden administration, but we had not yet seen many details that allowed...more

Brownstein Hyatt Farber Schreck

Using Complex Algorithms Is Not a Legal Defense for Discrimination

The Consumer Financial Protection Bureau recently warned companies that, under federal anti-discrimination laws, they still owe consumers an explanation of specific reasons for denying credit applications, even if they use...more

Cadwalader, Wickersham & Taft LLP

No, Fancy Technology Does Not Excuse Compliance Obligations

The Consumer Financial Protection Bureau (“CFPB”) released a regulatory Circular providing guidance regarding the use of “complex algorithms” to assess whether a consumer should be extended credit. Often referred to as “black...more

Jenner & Block

CFPB and other Federal Regulators Eye Regulation Aimed at Curbing Algorithmic Bias in Automated Home Valuations

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Late last month, the Consumer Financial Protection Bureau (CFPB) took another step toward adopting rules governing the use of artificial intelligence (AI) and algorithms in appraising home values. Specifically, the CFPB...more

Jenner & Block

Potential Bias in AI Consumer Decision Tools Eyed by FTC, CFPB

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Potential discrimination and bias resulting from consumer tools based on artificial intelligence and automated data will be an enforcement focus of regulators this year, Jenner & Block attorneys predict. Accuracy and...more

Robins Kaplan LLP

Financial Daily Dose 11.11.2019 | Top Story: Twitter Screed Prompts Investigation of Apple Card Gender Discrimination

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Here’s about as 2019 as we can get in the financial world (with a healthy dose of 1950s-era gender discrimination for good measure): a series of tweets from tech entrepreneur David Heinemeier Hansson alleging gender...more

Ballard Spahr LLP

Petition filed with FTC seeking investigation of use of “secret surveillance scoring”

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The Consumer Education Foundation, a California-based nonprofit consumer advocacy organization, has filed a petition with the FTC asking it to investigate the use of “secret surveillance scores” in the U.S. marketplace....more

Ballard Spahr LLP

Democratic Senators seek information about discrimination by lenders using algorithms

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Democratic Senators Elizabeth Warren and Doug Jones have sent a letter to the CFPB, Federal Reserve, OCC, and FDIC expressing concern that fintech and traditional lenders using algorithms in their underwriting processes are...more

Carlton Fields

The Ghosts of Christmas Past, Present, and Future Haunt Insurers’ Use of Big Data and Algorithmic Tools

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Watching as legislators, regulators, and policymakers’ consider what changes, if any, are necessary for insurers’ use of big data and algorithmic tools, is like being visited by the Ghosts of Christmas Past, Present, and...more

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