COO Mike LaRosa was recently featured in a RESPA News story about the impact of AI on joint ventures (JVs) in the title industry, and how regulators will likely react to its usage in a number of different situations.
The conversation focused on when an AI-generated recommendation crosses into RESPA territory, a question more of our industry will be asking as AI tools increasingly become part of everyday transactions. Mike drew a clear line, observing that if the recommendation comes from a generic AI query pulling from public data and reviews, there's likely no concern. If it comes from a closed, proprietary platform owned by a referral partner in a JV, the analysis changes significantly.
Mike also suggested that a consumer interacting with a closed-loop AI system is, in his words, “a captive participant.” That establishes a different risk profile than traditional advertising, where a consumer still has the ability to shop around and compare.
He also flagged something we think a lot of companies haven't fully considered yet, which is how these AI tools get trained in the first place. A system built or trained to quietly exclude non-affiliated providers creates substantial exposure, even if no one intended it that way. He then offered ways to avoid that risk.
We're proud to see Mike continuing to be a resource on compliance questions the industry is just starting to grapple with. As AI becomes more embedded in how referrals happen, we expect this conversation to keep evolving, and we're glad to have someone at FAN contribute!
Thanks to RESPA News editor Rae Harris for covering this story and for the thoughtful questions that pulled out such a straight forward and practical take on a genuinely tricky issue.
