FAIRR Act

• Authority: United States Congress
• Parent authority: Federal government
• Jurisdiction: United States
• Collections: U.S. federal laws
• Most recent activity: Defunct
• Most recent activity date: 2025-01-03

Risk subdomain coverage

Good coverage — Comprehensive governance measures or mitigations with clear procedures relating to the risk subdomain are explicitly described.

• AI system security vulnerabilities
• Disinformation, surveillance, and influence at scale
• Fraud, scams, and targeted manipulation
• Governance failure
• Lack of capability or robustness

Minimal coverage — Brief mention but no specific mitigations, recommendations or governance measures relating to the risk subdomain are described.

• False or misleading information
• Competitive dynamics
• Lack of transparency or interpretability

All other risk subdomains had no coverage in this document.

Risk Coverage Summary

The document has good coverage of approximately 6-7 subdomains, with strong focus on malicious actors (4.1, 4.3), AI system security (2.2), competitive dynamics (6.4), governance failure (6.5), and lack of robustness (7.3). Coverage is concentrated in security, misuse prevention, and governance domains related to financial system stability.

Sector coverage

Good coverage — Comprehensive governance measures or mitigations with clear procedures relating to the sector are explicitly described.

• Finance & Insurance

Minimal coverage — Brief mention but no specific mitigations, recommendations or governance measures relating to the sector are described.

• National Security

All other sectors had no coverage in this document.

Sectors Summary

The document exclusively governs the Finance and Insurance sector, with comprehensive coverage of AI risks and oversight in financial institutions, securities markets, and related service providers. No other economic sectors are regulated by this legislation.

Legislative Status

Hard Law

Legislative Status Summary

This is a binding legislative act introduced in the U.S. Senate that amends the Financial Stability Act of 2010, establishing mandatory requirements, enforcement mechanisms, and civil penalties for AI use in the financial sector.

Actors

Proposer

• Entity Types: AI_Governance_Actor
• Summary: The bill was introduced in the Senate by Mr. Warner (for himself and Mr. Kennedy) and referred to the Committee on Banking, Housing, and Urban Affairs.

Target

• Entity Types: AI_Deployer, AI_Developer, AI_Infrastructure_Provider
• Summary: The document explicitly targets financial institutions and their service providers who use or deploy AI, as well as developers of AI models used in financial contexts. It establishes liability for anyone who deploys AI models and regulates third-party service providers.

Enforcer

• Entity Types: AI_Governance_Actor
• Summary: The document designates the Financial Stability Oversight Council and its member agencies as primary enforcers, with specific enforcement powers granted to various financial regulatory agencies including examination authority and penalty assessment.

Monitor

• Entity Types: AI_Governance_Actor
• Summary: The document establishes monitoring responsibilities for the Office of Financial Research to conduct research, the Council to identify threats, Congressional committees to review reports, and the Federal and Banking Information Infrastructure Committee to conduct scenario-based exercises.

AI Lifecycle Stages

Lifecycle stages covered by the documents, as defined in the OECD Framework for the Classification of AI Systems

• Verify and Validate
• Deploy
• Operate and Monitor

AI Lifecycle Summary

The document primarily addresses the Deploy and Operate and Monitor stages of the AI lifecycle, with some coverage of Verify and Validate through scenario-based testing requirements. It focuses on post-deployment oversight, monitoring of AI use in financial systems, and establishing liability frameworks rather than development or training phases.

Technical Scope

Terms relating to technical scope that are mentioned or implicitly referenced in the document

• AI Models
• AI Systems

Technical Scope Summary

The document explicitly mentions artificial intelligence models and tools/technologies but does not distinguish between specific AI types such as frontier AI, general purpose AI, foundation models, or generative AI. It does not reference compute thresholds or open-weight models. The focus is on AI applications in financial systems broadly.