The Biden administration's new Blueprint for an AI Bill of Rights to enhance protections for Americans elevates recent federal regulatory and enforcement actions related to consumer protection, financial services, and housing. In an attempt to help guide the design, development, and deployment of artificial intelligence (AI) and other automated systems, the White House Office of Science and Technology Policy released the Blueprint for an AI Bill of Rights ;on October 4, 2022. The blueprint and the ongoing and forthcoming agency actions are a reminder to consumer financial services companies to carefully design, monitor, implement, and test uses of AI.
The Blueprint cites several concerns that it is intended to address, including that "algorithms used in hiring and credit decisions have been found to reflect and reproduce existing unwanted inequities or embed new harmful bias and discrimination." The Blueprint for an AI Bill of Rights addresses these "urgent challenges by laying out five core protections to which everyone in America should be entitled," as detailed in a press release. The core protections are:
- Safe and Effective Systems: You should be protected from unsafe or ineffective systems.
- Algorithmic Discrimination Protections: You should not face discrimination by algorithms, and systems should be used and designed in an equitable way.
- Data Privacy: You should be protected from abusive data practices via built-in protections, and you should have agency over how data about you is used.
- Notice and Explanation: You should know that an automated system is being used and understand how and why it contributes to outcomes that impact you.
- Alternative Options: You should be able to opt out, where appropriate, and have access to a person who can quickly consider and remedy problems you encounter.
As part of its announcement, the White House draws attention to the recent Consumer Financial Protection Bureau (CFPB) statement that "federal anti-discrimination law requires that creditors provide consumers with specific and accurate explanations when credit applications are denied or other adverse actions are taken, even if the creditor is relying on a black-box credit model using complex algorithms." The CFPB is "also cracking down on algorithmic discrimination in the financial sector and hiring technologists to fully staff this oversight work."
Furthermore, the announcement reminds us that the Federal Trade Commission (FTC) is "exploring rules to curb commercial surveillance, algorithmic discrimination, and lax data security practices that could violate section 5 of the FTC Act."
The announcement also highlights the Department of Housing and Urban Development (HUD) role in promoting fair access to housing. The announcement refers to HUD plans to release guidance addressing the use of tenant screening algorithms in ways that may violate the Fair Housing Act. Also, with regard to home buyers and owners, the announcement draws attention to plans by federal agencies that regulate mortgage financing to "include a nondiscrimination quality control standard as part of a forthcoming proposed rule establishing quality control standards on automated valuation models so that these models do not rely upon biased data that could replicate past discrimination in housing."
There's no single overriding federal statute that regulates the use of artificial intelligence. The new Blueprint and CFPB, FTC, and HUD actions suggest compliance considerations for companies using artificial intelligence with consumer financial services and products, and housing.
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