WASHINGTON, D.C.— Shayna Olesiuk, Director of Banking Policy, issued the following statement in connection with the release of a new report by the Treasury Department on the “Uses, Opportunities, and Risks of Artificial Intelligence in Financial Services.”

“We applaud the Treasury Department for carefully considering both the benefits and risks of Artificial Intelligence (AI) in finance. The report rightly identifies the need for better collaboration—domestically and internationally—among governments, regulators, and the financial services sector. AI has great potential but also significant risks. The report also identifies the consumer protection harms that can result from biased data in AI models. As we explained in our comment letter, this is an issue that regulators and policymakers must carefully consider and act on.

“Unfortunately, the report does address the need for providing more resources and staff to federal agencies to properly regulate AI. AI in finance is rapidly evolving, and there needs to be increased funding to build staff, expertise, testing, and other capabilities to oversee and regulate AI and strengthen enforcement appropriately. Without these investments, there will be serious risks to consumers and financial stability, including the potential for fraud, discrimination, market crashes, and illegal activities.

“Innovation—related to AI or any other genuine technological advances—is the fuel that drives our economy, wealth creation, and rising living standards. However, bad actors, short-term thinking, or just development gone out of control can set that all back as the trust and confidence of the public, investors, markets, and governments are undermined if not destroyed.”