FINRA Reminds Members of Regulatory Obligations When Using Generative Artificial Intelligence (AI) and Large Language Models

On June 27, 2024, the Financial Industry Regulatory Authority, Inc. (“FINRA”) issued Regulatory Notice 24-09 (the “Notice”) reminding member firms that FINRA’s rules and the securities laws apply to the use of artificial intelligence (“AI”), including large language models (“LLMs”) and other generative AI (“Gen AI”) technology, just as they apply when member firms use any other technology.  The Notice does not create new legal or regulatory requirements or new interpretations of existing requirements, nor does it relieve member firms of existing obligations under federal securities laws and regulations.

FINRA reminds member firms that as they incorporate Gen AI or similar technologies into their businesses, they should be mindful of the implications associated with the use of such technologies and their regulatory compliance obligations.