Specific reasons are still required
The CFPB's 2022 circular says adverse-action notices under US credit law must give specific reasons, even when a decision uses a complex algorithm. Inability to explain a model does not remove the creditor's duty.
An explanation needs a trail
Teams need to know which factors and controls affected a decision, what the model returned and whether a person changed the outcome. A generic statement about AI cannot answer for a specific applicant.
Design for scrutiny before deployment
If an institution cannot produce the evidence needed to explain a decision, it should address that gap in the operating path rather than after a challenge. The same discipline supports accountable oversight in other regulated decisions.
Basis
CFPB Circular 2022-03 · ECOA / Regulation B §1002.9 · EU AI Act Annex III · GDPR Article 22