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SEC chief warns of potential for AI-caused financial crisis |
Securities and Exchange Commission (SEC) Chair Gary Gensler warned that a financial crisis caused by artificial intelligence (AI) is "nearly unavoidable" without regulation. |
Gensler told the Financial Times that an AI-caused financial crisis could occur within the next decade if regulators fail to establish guardrails for the rapidly advancing technology. However, he acknowledged that regulating AI in the financial sector will be a difficult task. "It's a hard financial stability issue to address because most of our regulation is about individual institutions, individual banks, individual money market funds, individual brokers; it's just in the nature of what we do," Gensler said. Instead, the concern with AI is "horizontal" because many institutions might rely on the same underlying base model or data aggregator, he said. Gensler warned that if multiple institutions are basing their decisions on the same models, it could lead to herd mentality and undermine stability. "I do think we will in the future have a financial crisis … [and] in the after action reports people will say 'Aha! There was either one data aggregator or one model … we've relied on,'" he told the UK newspaper. The SEC proposed a new rule in July targeting broker-dealers and investment advisers' use of predictive data analytics and similar technologies, including AI. However, Gensler noted that the rule — which bars firms from using the technology in a way that puts their interests above those of investors — does not solve the "horizontal issue" at hand. Read more in a full report at TheHill.com. |
Welcome to The Hill's Technology newsletter, we're Rebecca Klar and Julia Shapero — tracking the latest moves from Capitol Hill to Silicon Valley. | |
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How policy will be impacting the tech sector now and in the future: |
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LinkedIn is laying off more than 660 workers across its engineering, product, talent and finance teams, the employment-focused social media site announced Monday. "Talent changes are a difficult, but necessary and regular part of managing our business," the company said in a news release. This marks LinkedIn's second round of major layoffs this year, after it announced its plans to cut more than 700 jobs in May amid efforts … |
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| The Biden campaign Monday joined Truth Social, the platform founded by former President Trump, pushing its message on a platform largely dominated by the former president and his followers. “Well. Let's see how this goes. Converts welcome!” the campaign wrote in its first post on the platform under the handle @BidenHQ. The campaign followed up with another post that featured a video clip of Florida Gov. Ron DeSantis … |
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The Trump campaign on Monday lambasted a judge's ruling barring the former president from attacking witnesses in his Washington criminal case over his efforts to remain in power after losing the 2020 election. Trump has repeatedly targeted Judge Tanya Chutkan, special counsel Jack Smith, President Biden and D.C. itself through social media posts and public speeches
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News we've flagged from the intersection of tech and other topics: |
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'AI Agents' could change the workforce |
Researchers are testing ways to turn artificial intelligence (AI) chatbots into so-called AI Agents, that could efficiently organize tasks and change the workforce, The New York Times reported. |
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Popular destinations are banning influencers |
Certain restaurants and cafes, and even a picturesque small Vermont town, are putting in place restrictions on influencers after being in the spotlight on social media, Mashable reported. |
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Upcoming news themes and events we're watching: |
- The House Energy and Commerce Committee will hold a hearing titled "Safeguarding Data and Innovation: Building the Foundation for the Use of Artificial Intelligence" on Wednesday at 10 a.m. ET.
- The House Science, Space and Technology Committee will hold a hearing titled "Balancing Knowledge and Governance: Foundations for Effective Risk Management of Artificial Intelligence" on Wednesday at 10 a.m.
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Branch out with other reads on The Hill: |
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Kenyan Facebook moderators accuse Meta of not negotiating sincerely |
NAIROBI, Kenya (AP) — The lawyer representing 184 former Facebook content moderators based in Kenya who sued the site’s parent company, Meta, over working conditions and pay told the judge Monday that Meta has not been sincere in trying to reach an out-of-court settlement as agreed in the last … |
MANILA, Philippines (AP) — Canada will help the Philippines detect illegal fishing with its satellite surveillance system under a new agreement, Philippine officials said Monday. The arrangement gives the National Coast Watch Center of the Philippines access to data from Canada's "Dark Vessel Detection … |
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Two key stories on The Hill right now: |
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The battle for the Senate is ramping up a little more than one year before Election Day, with candidate and primary fields getting more settled by … Read more |
| Defense Secretary Lloyd Austin has ordered a select number of U.S. troops to prepare to deploy in support of Israel, multiple outlets have reported. … Read more |
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Opinions related to tech submitted to The Hill: |
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You're all caught up. See you tomorrow! |
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