Virginia Gov. Glenn Youngkin on Monday vetoed a bill that would have offered consumer protections to residents from discrimination created by artificial intelligence systems.
If enacted, the bill would have created requirements for companies developing, deploying and using “high-risk” AI systems. It would also have made companies responsible for protecting consumers from the potential bias created by using AI to make “consequential” decisions.
The bill defines consequential decisions as those made about an individual’s parole, probation, pardon or any other release from incarceration or court supervision; education enrollment or an education opportunity; employment; access to financial or lending services; health care services; housing; and insurance, among others.
The bill would have made Virginia the second state to get such AI discrimination rules on the books, after Colorado last year passed the nation’s first comprehensive AI law.
In a statement explaining his veto, Youngkin said the legislation would have created a “burdensome artificial intelligence regulatory framework,” and stifled innovation in the state. He also noted that his AI executive order, which he signed in January 2024, already established responsible AI usage guidelines across the executive branch, and that the state’s AI task force is working with the governor on key AI governance issues.
“The role of government in safeguarding AI practices should be one that enables and empowers innovators to create and grow, not one that stifles progress and places onerous burdens on our Commonwealth’s many business owners. This bill would harm the creation of new jobs, the attraction of new business investment, and the availability of innovative technology in the Commonwealth of Virginia,” Youngkin’s statement read.
Statement from American Fintech Council (AFC) CEO Phil Goldfeder on Virginia Governor Glenn Youngkin’s Veto of SB 1252
“Governor Youngkin’s decision to veto SB 1252 protects access to safe, responsible credit for hundreds of thousands of Virginians. The bill, while well-intentioned, would have created unnecessary barriers for consumers seeking flexible financial tools and introduced legal uncertainty for responsible providers. AFC has been deeply engaged on this issue from the start—meeting with lawmakers, submitting formal comments, and mobilizing a coalition of responsible providers to raise concerns about the bill’s impact.
“This veto reflects a thoughtful and pragmatic approach to regulation—one that puts consumers first without stifling responsible innovation. AFC thanks Governor Youngkin for standing up for financial inclusion and recognizing the importance of maintaining a diverse and competitive credit marketplace in Virginia. We remain committed to working with lawmakers in Virginia and across the country to ensure policy solutions reflect the realities of today’s financial landscape.”
