The United States Commodity Futures Trading Commission (CFTC) Commissioner, Kristin Johnson, has put forth three proposals for regulating artificial intelligence (AI) technologies in the country’s financial markets. During the Technology Advisory Committee meeting on May 2, Johnson outlined the CFTC’s three-pronged agenda, which includes establishing a “principles-based framework” to evaluate the risks associated with integrating AI into financial markets, imposing stricter penalties for the intentional misuse of AI, and forming a task force to assess and harmonize the guidance, supervision, and regulation concerning the increasing integration of AI in financial markets.
While it is not uncommon for the government to call for the creation of investigatory task forces and risk assessment platforms, Johnson’s suggestion of imposing “heightened penalties” for crimes committed with the use of AI would bring about significant changes to the existing legal framework. Johnson referred to a previous statement by U.S. Deputy Attorney General Lisa Monaco, who compared AI to firearms, stating that both can enhance the danger of a crime. Johnson believes that the advent of AI technologies and their potential for misuse should be treated similarly.
This announcement by the commissioner follows the CFTC’s appointment of its first chief AI officer, Ted Kaouk, who 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 play a crucial role in developing legislation and policies related to the U.S. financial market.
Related: The UK government calls for action on AI copyright and market competition.