New York's top financial regulator zeroing in on agentic commerce

• Key insights: Speaking at the New York Federal Reserve's Innovation Conference on Friday, New York Department of Financial Services acting Superintendent Kaitlin Asrow said the regulator was interested in maintaining long-standing consumer protections as AI adoption increases. 
• What's at stake: Questions surrounding liability are becoming increasingly prevalent as AI agents' ability to act autonomously and transact on behalf of customers evolves. 
• Expert quote: "The idea that a transaction can self-execute is a little jarring to a regulator," NYDFS acting Superintendent Kaitlin Asrow said. 

NEW YORK — New York's Department of Financial Services is keeping a close eye on how agentic commerce and payments are evolving, and has been grappling with questions surrounding liability and consumer protections as the agency builds out its regulatory position on the nascent technology. 

Speaking at the New York Federal Reserve's Innovation Conference on Friday, New York Department of Financial Services acting Superintendent Kaitlin Asrow said the regulator is interested in maintaining long-standing consumer protections as AI adoption increases. 

"In terms of agents, we have been very focused on … where does liability sit? How do we maintain those essential consumer protections and the payments flows in our financial system that we've had for a very long time, and how do you layer this new opportunity of data and spend onto it," Asrow said. 

Questions surrounding liability are becoming increasingly prevalent as AI agents' ability to act autonomously and transact on behalf of customers evolves. Robinhood — which was one of the first financial institutions to let its customers bring their own agents onto its platform and autonomously transact using its credit card — has taken the stance that customers are ultimately liable for actions taken by their agents. Left unchecked, charge-back, dispute and liability gaps that appear as a result of agentic commerce could expose banks to mass consumer redress demands.

"The idea that a transaction can self-execute is a little jarring to a regulator. How do I make sure that consumers are protected throughout?" Asrow said, noting the regulator will be focused on ensuring that companies have proper systems and governance in place. 

"There's no one way in which AI is being applied, and there's no one way to do it right," Asrow said. "That being said, of course, there's a lot of ways to do it wrong." 

Asrow, who was a top DFS staffer and former Federal Reserve advisor, became the acting superintendent of the NYDFS in September of last year after Adrienne Harris stepped down. Harris had a four-year tenure as superintendent of NYDFS. Benjamin Lawsky was the first superintendent of New York banks when the role was first created in 2011. 

State regulators have stepped up their efforts to regulate financial markets in the absence of active federal oversight. For example, Asrow, in one of her first pieces of guidance after taking the acting superintendent role, clarified banks' responsibility for their vendors' cyber risk, Rhode Island wrote its own cybersecurity rules for nonbanks, and both New Jersey and California considered their own versions of the Community Reinvestment Act that would rope in nonbanks, to name a few.