United States Commodity Futures Trading Commission (CFTC) Commissioner Kristin Johnson has put forward three proposals for regulating artificial intelligence (AI) technologies in the country’s financial markets. Johnson presented these proposals during a recent meeting of the Technology Advisory Committee on May 2. The CFTC’s agenda includes the development of a “principles-based framework” to assess the risks of integrating AI into financial markets, stricter penalties for the intentional misuse of AI, and the establishment of a task force to evaluate and harmonize guidance, supervision, and regulation concerning the growing integration of AI in financial markets.
While government calls for the creation of investigative task forces and risk assessment platforms are not uncommon, Johnson’s recommendation for “heightened penalties” for AI-related crimes would bring significant changes to the existing legal framework. Johnson referenced a speech by U.S. Deputy Attorney General Lisa Monaco, who compared AI to firearms, stating that just as guns enhance danger, AI can also enhance the danger of a crime. Johnson argues that the emergence of AI technologies and their potential for misuse should be treated accordingly.
This speech by the commissioner follows the recent appointment of Ted Kaouk as the CFTC’s first chief AI officer. Kaouk previously served as the chief data officer and director of the division of data within the CFTC.
In the meantime, Representative Maxine Waters, the ranking member of the Financial Services Committee, has written a letter to U.S. President Jose Biden recommending Johnson for the position of assistant secretary for financial institutions at the U.S. Department of the Treasury. If nominated and approved, Johnson would have a crucial role in shaping legislation and policies relating to the U.S. financial market.
Related: The UK government calls for action on AI copyright and market competition.