Client updates /  AI Regulation

The Israeli Money Laundering and Terrorist Financing Prohibition Authority (IMPA) published a document recently to raise awareness of the new challenges abuses of Generative AI and Deepfake pose to the financial sector. The document reviews the potential risks of use of these technologies, presents case studies from Israel and around the world, discusses emerging threats, and provides a list of “red flags” to help identify suspicious activities.

A significant development occurred last week at the interface between artificial intelligence and intellectual property following the settlement agreement reached by Anthropic in the class action lawsuit filed against it with the US District Court for the Northern District of California.

Amendment 13 to the Israeli Privacy Protection Law is expected to come into effect in mid-August 2025. The amendment prescribes, inter alia, organizations’ obligation to appoint a data protection officer. The Privacy Protection Authority recently published a draft directive on implementing this obligation. The draft is not final and is open for public comments.

At the end of June 2025, the Northern California District Court issued two precedent-setting rulings addressing the legal question: Is it lawful to use copyrighted works for machine training of AI-based large language models (LLMs)?

Earlier this month, the US Senate voted 99-1 to strike a key clause in a sweeping Republican domestic policy bill that sought to impose a ten-year moratorium on states’ enforcement of artificial intelligence regulations.

The Israeli Privacy Protection Authority (PPA) published a draft directive recently to clarify its position about how businesses and organizations should apply the provisions of the Privacy Protection Law and the privacy regulations to artificial intelligence systems.

The AI revolution in the Israeli capital market: The Israel Securities Authority allows financial institutions to use chatbots on their financial analyses platforms, but imposes clear rules and important restrictions on their use.