Artificial Intelligence (AI) and the SEC: Present and Future Risks

Summary

This article discusses artificial intelligence (AI) risks relevant to broker-dealers and investment advisers, both regulated by the U.S. Securities and Exchange Commission (SEC). Specifically, the article highlights a brief history and definition of AI, an overview of AI influence in financial markets, various AI risks for broker-dealers and investment advisers, ways to safeguard against AI-related risks, and the recent SEC approach to AI risks. Last, given the current and future AI-related risks, this article considers next steps for broker-dealers and investment advisers.