In a recent development with far-reaching implications, the U.S. Securities and Exchange Commission (SEC) is implementing a crackdown on broker-dealers and investment advisors who use predictive data analytics. This intervention appears to be driven by concern over potential conflicts of interest arising from this particular application of artificial intelligence. According to a report by Faegre Drinker Biddle & Reath LLP, this development is one among many as regulators scramble to keep pace with the rapid influx of AI-powered processes in various industries.
The legislative landscape is also shifting, with the introduction of the “No Robot Bosses Act of 2023” in the Senate, aiming to regulate employers’ use of artificial intelligence. The bill comes as a response to the growing concerns about the potential misuse of AI in workplaces, such as unduly influencing or controlling staff behavior.
Global efforts to regulate artificial intelligence do not stop at the United States. A significant leap has been made by the Chinese government to curb the use of generative AI. The exact nature of this intervention has yet to be revealed, though given the regulatory tendencies of the Chinese government, it is bound to create a substantial shift.
While these regulatory efforts indicate a global recognition of the potential risks and challenges AI poses, they also highlight the complexity of creating rules for such an immensely flexible and evolving technology. Legal professionals around the world, especially those dealing with innovation and technology, need to stay abreast of these changing dynamics to ensure appropriate applications of artificial intelligence.