U.S. bank regulators are increasing oversight of how financial institutions use artificial intelligence, according to reports describing changes to standard bank examination processes. The Office of the Comptroller of the Currency (OCC) and the Federal Reserve are asking banks detailed questions about AI-related risks during routine examinations, with reporting citing unnamed sources and describing the scope of the inquiries.
Across the accounts, regulators focus on governance and control frameworks for AI systems, including how banks manage accountability for AI models and decision-making. The scrutiny also extends to protections for customer and client data, particularly where AI is involved in lending or other credit-related activities and where systems may access sensitive information.
Regulators are additionally examining third-party and vendor risk, including how banks assess and monitor external AI providers or technology vendors used in banking operations. One report says supervisors seek information on operational safeguards such as the existence of “kill switches,” which would allow banks to halt AI functions if needed. The overall effort aims to assess whether banks have appropriate risk management, data protection, and oversight measures for AI deployments.
