AI: Impact and Use in the Financial Services Industry (Part Four)

In this episode of Regulatory Oversight, Ashley Taylor welcomes Oregon Attorney General (AG) Ellen Rosenblum to discuss her new role as president of the National Association of Attorneys General (NAAG).

Rosenblum, the first female state AG in Oregon's history, has served in the role since 2012. As NAAG president, she plans to engage her fellow AGs in developing bipartisan programming at events, sharing ideas, and fostering collaboration. Her presidential initiative, "America's Youth, AGs looking out for the next generation," focuses on technology, healthy bodies and minds, and financial literacy.

Rosenblum shares the history of NAAG, which was created in 1907 to discuss a common approach to antitrust issues related to the Standard Oil Company. Today, NAAG serves as a platform for AGs to collaborate, share insights, and champion the interests of their respective states.

In the latest episode of Regulatory Oversight, Troutman Pepper Partner Judy Jagdmann and Counsel Gene Fishel are joined by Sam Kaplan, assistant general counsel for public policy for Palo Alto Networks. They engage in an insightful conversation revolving around the government response to cyber incidents and the potential role of AI in combating cybersecurity threats.

Kaplan, a former assistant secretary for cyber, infrastructure, risk, and resilience policy at the U.S. Department of Homeland Security, shares his expert perspective on the evolving cyber threat landscape as it relates to critical infrastructure. He categorizes cyber threats into four principal types: ransomware, industrial control system attacks, vulnerability exploitation, and supply chain attacks.

The discussion also addresses the challenges that critical infrastructure operators face, such as the use of legacy systems, IT/OT convergence, lack of skilled resources, regulatory compliance, and data management. Kaplan emphasizes the importance of understanding the regulatory landscape, the need for holistic cyber incident response, and the increasing sophistication and scale of cyber-attacks.

The discussion concludes with a reminder that cybersecurity is an all-encompassing issue that requires ongoing attention from all stakeholders within an organization.

In the latest episode of Regulatory Oversight, Troutman Pepper Partner Judy Jagdmann is joined by Oregon Attorney General (AG) Ellen Rosenblum to discuss her journey from being a federal prosecutor and state trial and appellate judge, to becoming Oregon's AG.

AG Rosenblum describes her role as both the chief law officer of the state and the people's attorney, representing state agencies, boards, commissions, the governor, and legislators, while also advocating for vulnerable populations.

Throughout the conversation, AG Rosenblum reflects on her diverse career path, which includes experiences as a small firm attorney, a federal prosecutor, a trial court judge, and now, AG. She underscores the significance of mastering advocacy, nurturing relationships, and preserving humility as essential attributes for legal professionals. She also shares insights on how career setbacks have often paved the way for new opportunities, ultimately leading her to her current role.

The discussion between Judy and AG Rosenblum also touches on advice for young women attorneys who aspire to leadership roles within the legal sector. AG Rosenblum encourages them not to shy away from leadership and management opportunities. She stresses the importance of actively seeking opportunities, accruing experience, and embracing risks. AG Rosenblum also highlights the importance of building and investing in relationships, sharing examples from her own career of how nurturing relationships has significantly impacted her career.

In the latest episode of Regulatory Oversight, Ashley Taylor is joined by his colleagues Kim Phan and Kristen Eastman to discuss the Consumer Financial Protection Bureau's (CFPB) 1033 proposed rule, also known as the Personal Financial Digital Rights rule. This rule, part of the Dodd-Frank Act, aims to place limits on the ability to access consumer data as well as any subsequent uses of such data. It focuses on entities subject to the Truth in Lending Act (TILA) and Regulation Z, such as depository institutions, credit card companies, and payment processors. The proposed rule requires these entities to make financial records available both to consumers and their authorized third parties.

The group discusses the proposed rule's lack of specificity regarding the "qualified industry standard" that companies must meet. They also discuss the potential of state attorneys general and plaintiffs' lawyers using the proposed rule for enforcement actions and litigation.

The CFPB has not yet issued guidance on the proposed rule's enforcement, and the group anticipates that the proposed rule could be finalized as early as next year. However, they also note that the proposed rule's timeline could be affected by litigation surrounding the CFPB's authority and funding.

In the latest episode of Regulatory Oversight, Troutman Pepper RISE attorneys Jean Gonnell and Cole White are joined by AGA's Bruce Turcott, legal editor of the Cannabis Law Deskbook, to discuss the evolution of cannabis regulation in Colorado and Washington, the first two states to legalize marijuana. They discuss the challenges and successes of implementing cannabis laws, including the development of licensing systems, the impact of local authority on licensing, and the role of receiverships in the industry.

Additionally, they cover social equity in the cannabis industry, with both states implementing programs to support those adversely affected by the war on drugs. 

The conversation concludes with a look at the future of cannabis regulation, including the potential federal rescheduling of cannabis, the need for national testing standards, and the impact of intoxicating hemp products. The speakers emphasize the importance of learning from the experiences of pioneering states, while recognizing that a one-size-fits-all approach may not be suitable for every state.

* Our Cannabis Practice provides advice on issues related to applicable federal and state law. Marijuana remains an illegal controlled substance under federal law.

In the latest episode of Regulatory Oversight, Gene Fishel and Mike Lafleur welcome Pat Moore and Jared Rinehimer from the Massachusetts Attorney General's (AG) Office to discuss online sports wagering. They cover the recently enacted Massachusetts Sports Wagering Act, the associated role of the Massachusetts Gaming Commission, related rules addressing advertising and data privacy, and the overall concerns of the AG's office.

They also highlight the heightened risk of gambling addiction exacerbated by the ease of betting and the introduction of in-game bets. They explore how gaming platforms can utilize user data to reduce such harm.

Finally, the group discusses the enforcement of gaming laws, including newly opened avenues for consumer protection enforcement.

In the latest episode of Regulatory Oversight, the National Association of Attorneys General (NAAG) Executive Director Brian Kane joins co-host Ashley Taylor to discuss the role that NAAG plays among attorneys general. NAAG provides a community for attorneys general and their staff to collaboratively address issues important to their work, as well as training and resources to support attorneys general. From Supreme Court training to a multistate settlement database, NAAG offers a variety of resources to the attorneys general offices.

Brian also discusses how his background as chief deputy in the Idaho attorney general's office helped prepare him for his role, as well as what he sees in the future for NAAG.

In this episode of the Regulatory Oversight Podcast, Judge VanDyke joins Troutman Pepper RISE attorneys Ketan Bhirud, Mike Yaghi, and Stephen Piepgrass for an informative discussion on his background and path to becoming a judge, including his time working in several state attorneys general offices.

Additionally, Judge VanDyke shares insightful information about the Ninth Circuit, some expected and unexpected experiences on the bench, and advice for people who want to become a judge.

Many companies use machine learning algorithms and artificial intelligence (AI) to assist with employment decisions and tenant screening. In our final episode, Stephen Piepgrass and colleagues Ron Raether and Dave Gettings examine the use and impact of AI in background screening, including the potential risks companies may face with increased reliance on AI.

Our panel also explores the increased focus on AI by various regulators and state attorneys general and offer some best practices to consider when developing or adopting machine learning models into business processes.

Financial services companies are using AI to assist with many business processes, including underwriting decisions, consumer credit approval, servicing and collections, loss mitigation programs, customer interaction on websites and mobile apps via chatbots, and in detecting fraud. In this fourth episode, Stephen Piepgrass and colleagues Chris Willis and Michael Yaghi examine the use and impact of AI in the financial services industry. They discuss the potential risks financial services companies may face with increased reliance on AI, as well as the increased focus on AI by various regulators and state attorneys general.

Our panel also offers practical suggestions for financial services companies who want to develop or adopt machine learning models into their business processes.

In our final episode of this series, we will discuss the impact and use of AI in Background Screening.