U.S. Banking Regulators Increase Scrutiny Of AI Use Across Financial Sector

U.S. banking regulators are intensifying oversight of how financial institutions deploy artificial intelligence (AI) as the technology becomes more widely used across banking operations.

According to people familiar with the matter, the Office of the Comptroller of the Currency (OCC) and the Federal Reserve have begun seeking detailed information during routine examinations on the use of AI in areas such as lending, customer verification, sanctions screening, and regulatory compliance.

Supervisors are examining governance frameworks, human oversight mechanisms, data access controls, third-party vendor management, and contingency measures, including the ability to shut down AI systems when necessary. Regulators are also assessing how banks manage risks related to cybersecurity, privacy, and compliance.

The review comes as lenders expand AI applications from customer service tools to more complex functions such as credit underwriting and risk monitoring.