CFTC commissioner wants to create AI fraud task force

Tristan Greene7 hours agoCFTC commissioner wants to create AI fraud task forceCommissioner Kristin Johnson’s remarks came just a day after the CFTC appointed its first chief AI officer.4097 Total views4 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksUnited States Commodity Futures Trading Commission (CFTC) Commissioner Kristin Johnson recently advanced three proposals for the regulation of artificial intelligence (AI) technologies as they apply to U.S. financial markets. 

Speaking at the Technology Advisory Committee meeting held on May 2, Johnson laid out the CFTC’s three-pronged agenda consisting of the establishment of a “principles-based framework” to assess the risks associated with integrating AI into financial markets, heightened penalties for the intentional misuse of AI, and the creation of a task force to “evaluate, assess, and harmonize guidance, supervision, and regulation that addresses the increasing integration of AI in financial markets.” 

While government calls for the creation of investigatory task forces and common-sense risk assessment platforms are nothing new, Johnson’s assertion that crimes committed with the use of AI should be given “heightened penalties” would pose significant changes to the existing legal framework.

Johnson cited a previous speech given by U.S. Deputy Attorney General Lisa Monaco, who said that “guns enhance danger, so when they’re used to commit crimes, sentences are more severe. Like a firearm, AI can also enhance the danger of a crime.”

Per Johnson, the advent of AI technologies and their potential for misuse should be treated in a similar manner:“To address these concerns, the Commission should introduce heightened penalties for those who intentionally use AI technologies to engage in fraud, market manipulation, or the evasion of our regulations. Bad actors who would use AI to violate our rules must be put on notice and sufficiently deterred from using AI as a weapon to engage in fraud, market manipulation, or to otherwise disrupt the operations or integrity of our markets.”

The commissioner’s speech comes on the heels of the CFTC’s appointment of its first chief AI officer, Ted Kaouk. Kaouk’s previous role within the CFTC was as its chief data officer and director of the division of data.Source: U.S. House Committee on Financial Services

Meanwhile, Representative Maxine Waters, the ranking member of the Financial Services Committee, recently penned a letter to U.S. President Jose Biden recommending Johnson be nominated 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 key role in instituting legislation and policies related to the U.S. financial market.

Related:UK gov’t calls for action on AI copyright, market competition# Congress# CFTC# United States# AI# RegulationAdd reaction