Global Regulators on High Alert for AI Systemic Risk
Reflecting the growing focus on and fears about fintech, the Financial Stability
Board today expanded on its current fintech principles and released a report on the
potential financial-stability impact of growing financial-industry and regulatory
reliance on artificial intelligence (AI) and machine learning (ML). This FedFin report
assesses the FSB’s key concerns and what it recommends be done about them not
only with regard to use of AI and ML in areas such as insurance contracts,
settlement, and underwriting, but also as the “regtech” field advances and regulators
or companies rely on AI and ML in areas such as AML compliance.