Sandra Grannum Discusses SEC Charging Investment Advisers Over AI Claims With FundFire

In “SEC Puts Industry on Notice with ‘AI-Washing’ Charges,” business litigation partner Sandra Grannum spoke to FundFire about the Securities and Exchange Commission’s (SEC) charges against two investment adviser firms, as well as the agency questioning how investment adviser firms apply artificial intelligence (AI) and launching a targeted exam sweep in 2023.

“It did appear that [the charges] were, in fact, part of the sweep,” said Grannum. “I’ve not seen any other AI-washing charges.”

Grannum added, “[The SEC is] not going to wait until the proposed predictive data analytics rule is necessarily passed before they take action. Arguably, they can take action under the rules that presently exist.”

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