Developments in Artificial Intelligence Regulation in Financial Services

1 minute read | June.23.2026

Artificial intelligence continues to reshape the financial services industry, prompting lawmakers, regulators and enforcement agencies to confront new questions around consumer protection, fair lending, governance, cybersecurity and innovation.

In this article, published in the Spring 2026 issue of The Business Lawyer as part of the American Bar Association's Annual Consumer Financial Services Law Survey, Orrick attorneys Caroline Stapleton and Lauren Bomberger examine the most significant developments in AI regulation affecting financial institutions during 2024 and 2025. The survey covers emerging state AI laws, federal policy initiatives, agency guidance, enforcement actions and evolving expectations for the responsible development and deployment of AI in financial services.

The article also explores key regulatory themes, including algorithmic discrimination, AI governance and risk management, fair lending, cybersecurity, model risk and the growing role of AI in compliance and customer-facing applications.

Originally published in The Business Lawyer; reprinted with permission.

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Authors

Caroline Stapleton Partner, Financial & Fintech Advisory, Strategic Advisory & Government Enforcement (SAGE)

Washington, D.C.

See my bio

D:+1 202 461 2904
E: [email protected]

Practice:

Financial & Fintech Advisory
Strategic Advisory & Government Enforcement (SAGE)
Fintech

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See full bio

Caroline Stapleton Partner

Washington, D.C.

Client-centered experiences are at the heart of Caroline’s practice. She has provided a wide variety of institutions, from fintech startups to multinational banks, with tailored, practical guidance that considers each company’s unique characteristics and strategic goals. Caroline draws on her prior experiences as an attorney at a federal prudential regulator and as the head of compliance at a consumer finance company to give clients a comprehensive picture of the legal risks and opportunities each new matter presents.

Her work on behalf of financial services providers has included:

Providing guidance regarding novel or complex regulatory questions, often in the context of developing new financial products and services
Performing compliance risk assessments of marketing, underwriting, pricing, origination, servicing and loss mitigation activities
Advising banks and supervised lenders with examinations by federal and state regulators, including responding to exam findings, CAMELS ratings, Matters Requiring Attention (MRA/MRIA) and enforcement referrals
Strategically responding to and defending enforcement actions by state and federal regulators, including the Consumer Financial Protection Bureau (CFPB), Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), Federal Reserve Board and Department of Justice (DOJ), and, if necessary, negotiating favorable settlements
Developing strategies for bank partnership, state licensing and bank charter opportunities for consumer financial services providers
Conducting internal investigations of suspected misconduct or violations of an institution’s policies and/or regulatory requirements

In these and other representations, Caroline brings strong substantive knowledge of the key federal and state statutes and regulations governing the financial services industry. Her specific areas of focus include:

Fair lending and anti-discrimination laws, including the Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA)
Prohibitions on unfair, deceptive or abusive acts or practices (UDAP and UDAAP)
Technical regulatory compliance under federal and state laws governing loan marketing, disclosures, settlement practices, servicing and collection practices, consumer reporting and electronic payments
Federal preemption, including under the National Bank Act
Compliance management best practices and regulatory expectations, including third-party vendor and merchant oversight
Treatment and disclosure of confidential supervisory information (CSI)
State lease-to-own laws and regulations

Prior to joining Orrick, Caroline was senior counsel at Buckley LLP. She also has served as an attorney-advisor in the litigation division of the OCC, where she represented the agency in civil litigation, bank receivership preparation, employment disputes and other administrative contexts. Caroline also gained valuable in-house experience as the head of compliance and assistant general counsel of a Richmond-based consumer finance company.

Lauren Bomberger Managing Associate, Financial & Fintech Advisory, Strategic Advisory & Government Enforcement (SAGE)

Washington, D.C.

See my bio

D:+1 202 461 2970
E: [email protected]

Practice:

Financial & Fintech Advisory
Strategic Advisory & Government Enforcement (SAGE)
Fintech

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See full bio

Lauren Bomberger Managing Associate

Washington, D.C.

Lauren’s practice covers a wide spectrum of banking and consumer financial services issues, with particular experience in:

Fair lending, including the Equal Credit Opportunity Act (ECOA/Regulation B) and the Fair Housing Act (FHA);
The Community Reinvestment Act;
Prohibitions on unfair, deceptive, or abusive acts or practices (UDAAP); and
Enforcement and supervisory matters, including counseling clients on examination responses, responding to regulatory subpoenas and information requests, and consent order compliance.

Lauren has significant experience advising clients on matters involving fintech, traditional retail banking products, including mortgages and other consumer lending products, and private banking. Lauren also assists clients in their interactions with federal regulatory agencies, including the Federal Reserve Board of Governors (FRB), the Office of the Comptroller of the Currency (OCC), and the Consumer Financial Protection Bureau (CFPB), and has successfully represented a client in an appeal of a material supervisory determination before the Federal Deposit Insurance Corporation (FDIC).

Lauren received her J.D. from the American University Washington College of Law (magna cum laude, Order of the Coif). During law school, she served as Executive Editor of the American University Business Law Review and was awarded the T. Morton McDonald Award for excellence in legal scholarship.

Prior to joining Orrick, Lauren was an associate at Buckley LLP.