Navigating the use of AI in the securities industry: key regulatory insights and strategies

The article sets forth certain practical legal and compliance considerations based on the principles articulated in current regulatory guidance, including with respect to conflicts of interest, data governance, customer privacy, cybersecurity, SEC Regulation Best Interest, recordkeeping, disclosure obligations, and supervisory control systems.

The article also emphasizes that firms should continue to communicate with their regulators to ensure that they are current on all regulatory developments governing AI that are relevant to their business operations.

The article further advises that firms should work with in-house or outside counsel, together with their compliance, risk, and operations personnel, and business teams as they continue to navigate the U.S. regulatory environment governing their use of AI to ensure they employ a holistic approach to their legal, supervisory, and compliance programs. 

Link to the article: The use of AI in the securities industry: U.S. regulatory considerations for broker-dealers and SEC-registered investment advisers.