SEC to Weigh New AI Rules for Brokerages

Meanwhile, robo-advisors, brokerages and wealth managers have been exploring how to individually target consumers with tailored marketing, pricing and prompts.

Despite an explosion in media attention around AI tools, the U.S. government hasn’t formulated a comprehensive approach to the new technologies.

Earlier on Tuesday, Rohit Chopra, the country’s top consumer watchdog said that if left unchecked the AI could usher in more fraud and discrimination in finance.

The looming proposal to crack down on AI use by brokerages was introduced in the SEC’s semiannual rule-writing agenda, which included dozens of other regulatory plans.

The agency said it planned to propose requiring more robo-advisors, or internet advisers, to register as money managers with the agency. That tag carries additional regulatory requirements.

The SEC also said it was weighing requiring large brokers to calculate their customer reserve deposit requirements on a daily, rather than on a weekly basis.

(Photo: Diego M. Radzinschi/ALM)