New White House, New AI Rules: Corporate America's Next Move

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New White House, New AI Rules: Corporate America's Next Move

Public companies are navigating a complex landscape of new AI regulations and enforcement expectations. The SEC and FTC are closely monitoring how these companies disclose their AI capabilities and manage associated risks. With the rise of generative AI tools like ChatGPT, the potential for misuse and misinformation has heightened, prompting calls for careful compliance.

The recent shift in regulatory focus, particularly under the Trump administration, has led to the revocation of previous AI guidelines. Companies must now ensure that their public disclosures regarding AI are accurate and not misleading, as the SEC has already initiated enforcement actions against firms like Presto Automation. This evolving regulatory environment necessitates that boards of directors enhance their understanding of AI technologies and the risks they entail.

• SEC and FTC are monitoring public companies' AI disclosures closely.

• Generative AI tools pose risks of misinformation and fraud for public companies.

Key AI Terms Mentioned in this Article

Generative AI

Generative AI refers to algorithms that can create new content, such as text or images, based on input data.

AI Compliance

AI compliance involves adhering to regulations and guidelines governing the ethical use of AI technologies.

AI Disclosure

AI disclosure pertains to the obligation of companies to accurately report their use and capabilities of AI in public filings.

Companies Mentioned in this Article

Presto Automation

Presto Automation is a restaurant-technology company that faced SEC charges for misleading statements about its AI product.

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