Dickinson, Bradshaw, Fowler & Hagen, P.C. - Dickinson Bradshaw Cares

New Reg E Liability: The AI Bought That, Not Me!

jlande@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Tue, 20 Jan 2026 12:26:30 +0000

Artificial intelligence (“AI”) tools are expanding into every aspect of consumers’ daily lives. That proliferation has the potential to dramatically increase bank liability under the Electronic Funds Transfer Act (“EFTA”) and Regulation E.

The consulting firm McKinsey & Company recently reviewed the potential for “agentic” AI to conduct consumer transactions. An “agentic” AI model is one that is given agency to take actions on behalf of a user. This has opened the possibility of agentic AI not only providing recommendations for consumers, but actually executing transactions:

And what begins as AI-mediated discovery increasingly carries through to execution, as AI agents compare options, assemble baskets, and complete checkout via emerging payment protocols and merchant integrations. The AI platform Perplexity, for example, launched an agentic shopping tool, “Perplexity Buy with Pro,” in late 2024. OpenAI’s Operator, launched in January 2025 and now integrated into ChatGPT, uses agents to help users automate tasks like booking travel and restaurant reservations. More recently, OpenAI announced an Agentic Commerce Protocol, codeveloped with Stripe, which allows users to complete purchases within ChatGPT without leaving the chat.

McKinsey & Company, October 17, 2025 Report (emphasis added). As described by McKinsey, agentic AI developers are looking forward to a day where entire transactions are conducted through agentic AIs interacting with each other on behalf of their users.

Anyone who has used AI today, however, is familiar with the potential for errors. AI tools generated a list of fake books for a summer reading list, ordered $222 worth of chicken nuggets at McDonald’s, and approved serving food that had been nibbled on by rats. No doubt, many of these errors will be worked out over time.

The stakes are low when an agentic AI accidentally tells a restaurant with humans in the kitchen to cook 260 chicken nuggets. Humans can easily intervene to correct the obvious error. But what happens if instead of humans in the kitchen, another agentic AI is in charge of fulfilling the order and charging the customer? McKinsey anticipates such a day may come when different agentic AI tools negotiate and consummate transactions with minimal human oversight.

Banks may unwittingly find themselves underwriting the risk that the agentic AIs get these transactions wrong. Banks are already well aware that under the EFTA and Regulation E, banks can end up being liable for losses resulting from unauthorized transactions from consumer accounts. Banks can be liable for “errors” which include:

(i) An unauthorized electronic fund transfer;

(ii) An incorrect electronic fund transfer to or from the consumer's account;

12 C.F.R. § 1005.11. Is an agentic AI transaction authorized by the consumer? Presumably, the consumer will provide their debit card number to the agentic AI tool in order to facilitate transactions. If the agentic AI uses the debit card to buy 260 chicken nuggets, does that mean the debit card has been stolen?

These questions are about to be posed to financial institutions all over the country as agentic AI tools proliferate. Banks should consult with their compliance and legal counsel to ensure they have a consistent response to the potential for unauthorized agentic AI transactions. One issue for consumers claiming a transaction is unauthorized will be showing that they received no benefit as required by 12 C.F.R. § 1005.2(m). Or, was a consumer fraudulently induced to provide their information to the agentic AI under the premise that the agentic AI would not buy 260 of anything?

Someone is going to be left holding the bag for agentic AI misfiring. Hopefully, the bag will come with some fries.

Free Legal Clinic on Friday, October 25

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Fri, 04 Oct 2024 09:53:51 +0000

Dickinson Bradshaw and Drake University Law School have teamed up to offer a free community clinic to help individuals prepare powers of attorney, living will, and simple will documents on Friday, Oct. 25. Participants may choose from three convenient sessions: 9–10:30 a.m., 12–1:30 p.m., or 4–5:30 p.m.

Each session will consist of a 45-minute overview about powers of attorney, living wills, and simple wills, followed by a one-on-one appointment with a licensed Dickinson Bradshaw attorney and/or Drake Law student to complete the required documents. Attorneys will be available to answer additional questions. Participants will have the opportunity to obtain signed and notarized documents for their files.

The clinic will be held at Drake University Law School, Cartwright Hall, 2621 Carpenter Avenue, Des Moines, in room 201.

The clinic is being held as part of Drake Law and Dickinson Bradshaw’s recognition of Cady Day of Public Service. Cady Day of Service brings the community together to honor and celebrate the life and legacy of the late Chief Justice of the Iowa Supreme Court Mark S. Cady.

Holiday Helpers 2021

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Wed, 01 Dec 2021 15:05:14 +0000

The attorneys and staff of Dickinson Law continued their annual holiday tradition this season by embracing a family through the Adopt-A-Family program sponsored by Children & Families of Iowa (CFI).

Made possible through donations, employees of the firm came together to purchase, wrap and deliver several gifts in the hopes of brightening the holidays for a family of four.

Join us in helping others this holiday season

Want to help make the holidays merry and bright for others? CFI holiday giving programs are in need of volunteers, as well as donations, items and toys for families not served by the Adopt-A-Family program, including its popular Holiday Shop where CFI clients can choose gifts for their families.

See the available giving opportunities.

Happy Holidays!

Giving Back: Dickinson Law Participates in Second Annual Mark S. Cady Day of Service

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Fri, 22 Oct 2021 15:58:28 +0000

As part of the second annual #CadyDayofService, members of Dickinson Law volunteered their time by organizing and distributing food to individuals and families in need at Urban Dreams in Des Moines and working on home improvement projects with Habitat for Humanity of Central Iowa.

The event celebrates the life of late Iowa Supreme Court Chief Justice Mark S. Cady and his commitment to public service, access to justice, and civil rights.

Urban Dreams' mission is to advocate for all members of the community, breaking down barriers to success and collaborating with key stakeholders to overcome obstacles and uplift underserved and underrepresented people. Habitat for Humanity of Central Iowa develops community through the process of providing adequate housing for all people.

In 2020, hundreds of volunteers from Davenport to Council Bluffs and beyond the borders of Iowa, helped make the inaugural Mark S. Cady Day of Public Service a huge success. The events held as part of the inaugural Cady Day impacted well over 10,000 individuals through community service, legal clinics and educational programming.

Click here to learn more about the event and to see all of the projects across the state taking place in honor of Justice Cady.

Fulfilling Holiday Wishes – 2020

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Wed, 09 Dec 2020 09:52:45 +0000

In the spirit of giving back, the employees of Dickinson Law continued their annual holiday tradition this December by embracing a family through the Adopt-A-Family program from Children & Families of Iowa (CFI).

Made possible through donations, the firm purchased, created by hand, wrapped, and delivered several gifts in the hopes of brightening the holidays for a family of three of need.

Join us in helping others this holiday season

The need is greater than ever in 2020. CFI holiday giving programs are in need of volunteers, items and toys for families not served by the Adopt-A-Family program, such as its Applebee’s Coach’s Toy Drive and the Holiday Shop where CFI clients can choose gifts for their families.

See the available giving opportunities.

Making it Merry – 2019

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Mon, 25 Nov 2019 13:29:58 +0000

Continuing our tradition of giving back during the holidays, Dickinson Law has once again embraced a family through the Adopt-A-Family program from Children & Families of Iowa (CFI).

Made possible through employee donations, the firm was able to purchase, wrap, and deliver several gifts in the hopes of making Christmas truly special for a family of three of need.

Want to help others as well this holiday season?
CFI holiday giving programs are in need of volunteers, items and toys for families not served by the Adopt-A-Family program, such as its Applebee’s Coach’s Toy Drive and the Holiday Shop where CFI clients can choose gifts for their families.

See the available giving opportunities.

National Philanthropy Day Award Recognition

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Fri, 22 Nov 2019 15:10:32 +0000

Paul Tyler of Dickinson Law (pictured middle) and Jerry Jones (right) were honored with the Spirit of Philanthropy Award for their work as trustees of the W.T. & Edna M. Dahl Trust this afternoon at the Philanthropy Day Awards hosted by the Central Iowa Chapter of the Association of Fundraising Professionals.

The pair were nominated for the award by the UnityPoint Health – Des Moines Foundation for their commitment to carrying on the charitable aspirations of the Dahl family, whose chain of popular grocery stores served the Des Moines area for more than 80 years. Throughout the Dahl’s lifetime, the Trust has supported many charitable endeavors, among them the Red Cross, Youth Homes of Mid America, and Living History Farms.

Following to the Dahl’s passing, the Trust has provided more than $12 million to over 100 nonprofit organizations. The impact of contributions from the Trust can be felt every time Iowans visit the Poppajohn Sculpture Park or Greenwood Park; when they experience the services provided by such organizations as Eyerly Ball and DMARC; and when they visit the Des Moines Consistory Building and Scottish Rite Masonic Center, maintenance of which was endowed by the Dahl Trust.

The award itself represents an envelope and was created by Roosevelt High School student Eddie Petraline (pictured left), whose artwork symbolizes the selflessness of the Dahl’s contributions, as their donations were always made anonymously.

Before becoming a trustee, Jones was an executive in the Dahl’s organization. Tyler is Of Counsel at Dickinson, Mackaman, Tyler & Hagen P.C. and has served in his role as trustee since 2007.

Help! My Data Is Held for Ransom!

jlande@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Tue, 12 Nov 2019 11:20:30 +0000

What do you do at 4:30 p.m. on Friday when your data is encrypted and a message tells you it will take 500 Bitcoin to decrypt it? This scenario has become a routine occurrence across the United States for local governments, non-profit organizations, and for-profit companies. What should an organization do when it discovers its systems are locked?

Don’t Just Replicate, Backup

Hopefully the organization has a backup. Many organizations routinely create a copy of their data in real time or close to real time. While this type of backup may protect against power failures and natural disasters, it may not be effective at mitigating ransomware risk. In some cases, real-time copying of data will copy the malware onto the copied server. When the ransomware kicks in, it can encrypt both the copy and the live system.

Organizations should examine whether there is any interruption in the transfer of data to their backups that will help mitigate the risk of malware infecting both primary and backup systems. If an organization is fortunate enough to have a backup, then it can purge the ransomware without worrying about paying.

No Backup, Big Problem

If the organization does not have a backup, then it has to look at other options. The organization should contact knowledgeable counsel and a computer forensic team. The computer forensic team can begin an investigation to determine whether the data can be decrypted without paying the ransom. More urgent, however, will be to try to fence the encrypted computers off from the rest of the environment if the ransomware has not encrypted everything.

Counsel will help craft the scope of the forensic team’s inquiry. The organization can maintain attorney-client privilege and work product protection over certain communications and documents created during incident response. Organizations need to be able to respond to the incident, but at the same time they should make sure that they are not creating a discoverable paper trail that could later be used against the organization. The scope of the forensic team’s work can also influence whether the organization has to turn over the team’s work product in discovery. Legal counsel can help an organization define the scope of work to mitigate the risk of future disclosure.

The organization’s immediate concern should be responding to the ransomware incident. However, organizations should also be mindful of potential legal risks. Shareholders, customers, vendors, and insurance carriers may all be potential adverse litigants in the future, so the incident response should proceed with that risk in mind.

Notify Insurance Company

Fortunately, many organizations now have ransom insurance coverage. These policies often identify panel counsel and forensic investigators. Policies may allow organizations to hire their own, subject to approval by the carrier, or may require use of panel vendors. Ideally, the organization will have identified these professionals ahead of time. If not, and the policy provisions are encrypted, then the organization should proceed with retaining knowledgeable experts.

Initial counsel or forensic experts can transition to panel professionals if necessary. However, it is ill-advised to wait days to begin remediating until panel professionals can be identified. From a forensic standpoint, it is important to make sure that logs and data are being preserved.

It is also important to keep in mind that panel insurance counsel should not advise an insured on the scope of insurance coverage. If there is ever a dispute with the insurance company over whether coverage applies—and there often is—then the organization will need to retain its own counsel.

To Pay or Not to Pay

Many organizations struggle with the question of whether to pay a ransom. It is difficult to take a principled position not to negotiate with fraudsters when an organization’s data is encrypted. If the organization has ransom insurance, and the carrier is willing to pay then it may be difficult for the organization to justify not paying. On the other hand, if the organization does not have insurance then it needs to weigh the cost of recreating the data compared to the ransom demand.

Many organizations are also concerned about whether fraudsters will actually provide decryption keys if they do pay. Engaging trusted professionals, including an attorney and forensic investigator, can help an organization weigh the pros and cons of paying.

Be Prepared

Organizations should think about what they will do in the event of a ransomware attack, so they are not left scrambling at 5 p.m. on a Friday trying to figure out what to do. Organizations should also review their insurance coverage to make sure they have the appropriate coverage, and identify knowledgeable professionals that can assist with incident response.

Helping Those in Need: Food Bank of Iowa Donation

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Tue, 22 Oct 2019 11:55:39 +0000

Did you know that 31.7% of Central Iowans struggle to earn enough to cover their basic needs? To help alleviate hunger in our community, the attorneys and staff members at Dickinson Law donated canned goods, food staples and personal items during its October United Way campaign.

The food and personal items are being donated to the Food Bank of Iowa, which has been providing food for Iowans in need since 1982. With the goal of doubling distribution and providing healthier food to those in need, the Food Bank launched its Fighting Hunger, Feeding Hope Campaign in 2016.

If you would like to join in the fight against hunger in Iowa, you can make a food or monetary donation to the Food Bank of Iowa at www.foodbankiowa.org.

It's United Way Campaign Week at Dickinson Law

noreply@dickinsonbradshaw.com (Dickinson, Bradshaw, Fowler & Hagen, P.C.) — Mon, 14 Oct 2019 11:26:52 +0000

It’s United Way Campaign 2019 week at Dickinson Law! Join us and LIVE UNITED because everyone deserves a chance to have an education, a healthy life, a good job, and a safe home. Don’t have a workplace campaign? You can also donate online at unitedwaydm.org.