In previous posts, we discussed the growing need for digital investment advisory tools in the U.S. As Gen Z and Millennials increasingly expect tailored digital services, we must also develop solutions that address regulatory obligations.
🎯 One key takeaway: there is currently no dedicated regulation addressing the use of AI in investment advisory services.
The U.S. Securities and Exchange Commission released a draft rule in 2023, but it was withdrawn in June 2025 — without any operational guidance. Under the current Trump administration, no new rulemaking is expected, echoing broader hesitation around a U.S. equivalent to the EU AI Act.
So what should you do?
🔍 If you're building an AI-powered investment adviser in the U.S., you're still required to comply with existing laws, especially fiduciary duties.
One of the clearest paths to aligning with fiduciary duties is by adhering to an AI standards framework — like National Institute of Standards and Technology (NIST) RMF.
🇺🇸 Enter the NIST AI Standards — especially: AI RMF 1.0
The National Institute of Standards and Technology (NIST) publishes voluntary frameworks for responsible AI system design and deployment.
📌 Their key framework:
AI Risk Management Framework 1.0 (NIST AI RMF 1.0)
Launched in 2023, it helps organizations develop and operate AI systems with risk management at the core.
🧩 Why this matters for Fintech and RIAs
An AI investment adviser built on the NIST AI RMF 1.0 framework:
- ✅ Reduces the risk of bias or error
- ✅ Ensures clear documentation of decision-making
- ✅ Aligns with fiduciary duty principles
- ✅ Builds trust with clients and regulators
- ✅ Offers an edge when partnering with institutional stakeholders
✳️ In summary:
While the SEC refines its stance on AI, your best path forward includes:
- ✅ Meeting fiduciary duties under the Investment Advisers Act
- ✅ Adopting NIST AI standards — especially AI RMF 1.0
- ✅ Documenting your bot's decision-making logic, controls, and explanations
- ✅ Involving legal and compliance experts early in development
👀 In upcoming posts, we'll unpack the NIST RMF framework and explore practical implementation strategies for AI investment advisers — including an explanation of the visual above.
The absence of specific AI regulation doesn't mean the absence of regulatory requirements. Fiduciary duty remains the cornerstone of investment advisory compliance, and NIST AI standards provide the roadmap for responsible AI implementation.
References
- NIST AI Risk Management Framework (AI RMF 1.0) - https://www.nist.gov/publications/artificial-intelligence-risk-management-framework-ai-rmf-10
- SEC Investment Advisers Act of 1940 - Fiduciary Duty Requirements
- Previous post: RIAs: Time to Adopt AI - https://handle-ai.com/knowledge/blog/investment-ai/rias-time-to-adopt-ai
- Previous post: Will We Soon See AI-Powered Investment Advisers in the U.S.? - https://handle-ai.com/knowledge/blog/investment-ai/will-we-soon-see-ai-powered-investment-advisers-us