US Rep. Foster Releases Draft Real-Time Regulatory Research Bill, Proposing Fed-Led Testing of AI Financial Stress Monitoring

US Representative Bill Foster of Illinois released a discussion draft of the Real-Time Regulatory Research Act of 2026 on November 5, 2026. The bill would authorize the Federal Reserve Board, together with other financial regulators, to develop, test, and publicly release open-source demonstration software. The software would be used to assess whether regulators can obtain real-time information on the health of banks and other financial institutions, while reducing the difficulty and cost of regulatory reporting.

According to his office, AI-driven financial services and round-the-clock payments could accelerate the transmission of stress through the financial system. More timely data and automated tools could allow regulators to see market changes earlier, and could help institutions and regulators respond in advance, improve emergency funding channels, and prepare for the orderly resolution of troubled banks.

The software would also provide a standard format and managed transmission tools for regulatory data, reducing manual reporting burdens on smaller institutions. Open-source development and multi-party maintenance are cited as reasons for strengthening security. Foster currently serves as the Democratic lead member of the House Financial Institutions Subcommittee and is expected to become its chairman next year. This draft is one of a series of AI bills he plans to pursue; other lawmakers are also expected to push legislation on AI model safety testing.

Source: https://www.pymnts.com/news/artificial-intelligence/2026/financial-oversight-draft-bill-gets-early-start-democrats-ai-agenda/