Artificial Intelligence, Finance, and the Law

21 Pages Posted: 6 Nov 2019 Last revised: 8 Nov 2019

See all articles by Tom C. W. Lin

Tom C. W. Lin

Temple University - James E. Beasley School of Law

Date Written: November 4, 2019

Abstract

Artificial intelligence is an existential component of modern finance. The progress and promise realized and presented by artificial intelligence in finance has been thus far remarkable. It has made finance cheaper, faster, larger, more accessible, more profitable, and more efficient in many ways. Yet for all the significant progress and promise made possible by financial artificial intelligence, it also presents serious risks and limitations.

This Article offers a study of those risks and limitations—the ways artificial intelligence and misunderstandings of it can harm and hinder law, finance, and society. It provides a broad examination of inherent and structural risks and limitations present in financial artificial intelligence, explains the implications posed by such dangers, and offers some recommendations for the road ahead. Specifically, it highlights the perils and pitfalls of artificial codes, data bias, virtual threats, and systemic risks relating to financial artificial intelligence. It also raises larger issues about the implications of financial artificial intelligence on financial cybersecurity, competition, and society in the near future. Ultimately, this Article aspires to share an insightful perspective for thinking anew about the wide-ranging effects at the intersection of artificial intelligence, finance, and the law with the hopes of creating better financial artificial intelligence—one that is less artificial, more intelligent, and ultimately more humane, and more human.

Keywords: artificial intelligence, algorithmic bias, high frequency trading, algorithmic trading, black box, financial cybersecurity, market manipulation, financial deep fakes, systemic risk, financial accidents, neural networks, financial accidents, algorithmic discrimination

Suggested Citation

Lin, Tom C. W., Artificial Intelligence, Finance, and the Law (November 4, 2019). 88 Fordham Law Review 531 (2019); Temple University Legal Studies Research Paper No. 2019-31. Available at SSRN: https://ssrn.com/abstract=3480607

Tom C. W. Lin (Contact Author)

Temple University - James E. Beasley School of Law ( email )

1719 N. Broad Street
Philadelphia, PA 19122
United States

HOME PAGE: http://https://www.law.temple.edu/contact/tom-lin/

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