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Reconciling AI With Fair Lending and Consumer Protection
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When it comes to AI in the consumer financial services context, U.S. laws lag somewhat behind the technology. But as Darren Welch explains in this edition of “Fintech Focus,” regulators are indeed targeting AI.
Skadden consumer financial services partner, Darren Welch joins host Joseph Kamyar in this episode of “Fintech Focus” for a discussion on AI in the fintech sector, specifically fair lending and consumer protection. Darren breaks down how regulators enforce transparency in lending decisions and how lenders can mitigate risk. He notes: “We’ve worked with a lot of clients on helping them set up their fair lending testing protocols and responding to regulatory inquiries about fair lending testing.”
💡 Meet Your Host 💡
Name: Joseph Kamyar
Title: European Counsel, Corporate at Skadden
Specialty: “Fintech Focus” host and European counsel Joseph Kamyar advises on a wide variety of corporate transactions, including cross-border private mergers and acquisitions, fundraisings, joint ventures, corporate reorganizations and general corporate matters, with a particular focus on the financial services, technology and media sectors.
💡 Featured Guest 💡
Name: Darren Welch
What he does: A consumer financial services partner in Washington, D.C., Darren Welch advises a broad range of companies and individuals in regulatory investigations, enforcement proceedings and examinations, as well as in civil litigation on all types of consumer financial services issues.
Organization: Skadden
Words of wisdom: “In September of 2023, the bureau issued a circular focused specifically on credit denials by lenders using AI. And that circular reminds creditors that they must provide accurate and specific reasons to consumers indicating why their loan applications were denied, including in circumstances where the creditor uses one of these AI models.”
Connect: LinkedIn
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Fintech Focus is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.
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