The United States Treasury is gearing up for a whirlwind of challenges and opportunities in the realm of artificial intelligence (AI) in the years ahead. This was the central theme of U.S. Treasury Secretary Janet Yellen’s keynote address at the Conference on artificial intelligence and financial stability. The conference, held on June 6-7, was organized by the U.S. Financial Stability Oversight Council (FSOC) in collaboration with the Brookings Institution.
According to FSOC, this marks the first time in ten years that the council has hosted an event of this kind. Secretary Yellen used her keynote speech to issue a formal call to action, inviting public feedback on the risks and opportunities presented by AI from financial institutions, consumers, and other stakeholders invested in U.S. financial stability.
Yellen highlighted various advantages that financial institutions can gain from utilizing AI, such as enhanced cybersecurity, more precise forecasting and predictions, improved customer service, and better account management. However, she also acknowledged the challenges, stating that “there are also new issues to confront, and this is a rapidly evolving field.” Yellen emphasized the need to address the “tremendous opportunities” and “significant risks” associated with AI technologies, noting that much work lies ahead.
Among the potential risks outlined by Yellen were concerns about the centralization of AI models and data, which could leave multiple market institutions vulnerable to a single point of failure. She also pointed out the risk of AI perpetuating bias due to the opaque nature of many models.
In a related development, U.S. antitrust enforcer Jonathan Kanter revealed that his office is conducting an investigation into the AI sector to address monopoly concerns. Kanter’s investigation will focus on various components of the AI technology stack and assess whether a few companies have undue control over critical aspects of the development process. This scrutiny will likely include examining Microsoft’s dominance in the cloud computing market and Nvidia’s stronghold in the AI chipset market.