Where the City’s movers and shakers have their say. Today, it’s Lucy McNulty, editor of the Following the Rules podcast.
The UK’s biggest finance firms are flunking their approach to generative AI. That was the takeaway from a recent conversation with a university professor who specialises in the new tech.
Holding a four-page policy from a major investment bank which purported to outline how the organisation planned to use GenAI responsibly, the professor told me he would fail a student for submitting a similarly sketchy draft.
To be fair, policymakers haven’t made it easy. The UK has opted to steer clear of AI-specific rules for now, leaving the onus on City businesses to determine how to use GenAI responsibly within existing regulatory frameworks. That is the right approach for the UK: heavy-handed or otherwise misguided legislation at too early a stage in the tech’s development and we risk curbing industry growth at a time when it is most needed.
But it places a lot of pressure on City firms to be conversant in the risks inherent in these new tools. And that’s a worry.
Shaun Hurst, principal regulatory adviser at tech firm Smarsh, told the Following the Rules Podcast series recently that avoiding compliance blowups when implementing GenAI tools was “one of the things that people are very concerned about”.
After all, those skilled in using AI are in the minority and in huge demand. Compliance is unlikely to be their first port of call. That leaves those tasked with ensuring firms implement these new tools in as safe a manner as possible in a scramble to educate themselves on the best approach. UK regulators are in a similar bind.
So let’s not sleepwalk into an AI-generated nightmare. The City and its watchdogs should instead work together to devise a code of best practice for GenAI use. Such a code could set industry guidelines for approving and subsequently monitoring new GenAI models, for example. It could also, crucially, provide insight into how GenAI tools are being used across the sector.
Adopting such a united approach to safeguarding against its risks would go some way to ensuring the sector can embrace GenAI without a major compliance blow-up. And that’s surely a win for all.
Car loan scandal
Just under half a million complaint emails were sent in the three days following the launch of a tool designed to help people reclaim car finance charges according to the man behind it, consumer champion Martin Lewis. It follows the FCA’s announcement that it will investigate if those who took out certain car loans are owed compensation. People have been wondering what would be the next multi-billion mis-selling scandal after payment protection insurance. Lewis may well have answered that one for us.
Changing how we look at ageing
Nothing focuses the mind more on the passing of time than a milestone birthday. As someone who has recently struggled through one of those, this book has provided some solace.
Written by “the world’s top longevity expert” Dr Peter Attia, Outlive is as much an insight into how he believes modern medicine needs to adapt to better address modern-day ailments, as it is a practical guide to rethinking your own approach to healthcare and self-care. It’s billed as a book that will completely transform your approach to growing old, and while it may not achieve that for all readers, it at least provides an easy-to-digest manual to making the rest of your life healthy and happy.
Watsapp crackdown
Ever since US regulators launched a crackdown on bankers’ illicit WhatsApp use in 2022, City bosses have been anxiously readying themselves for similar action over here. So a recent assurance from Financial Conduct Authority regulator Jamie Bell (pictured) to tech firm Global Relay that the watchdog did not have plans for a US-style WhatsApp clampdown will surprise many. Bell purportedly instead asked City firms to report WhatsApp misuse to the regulator. That’ll disappoint those hoping for action. But it’s sensible that our under-resourced City watchdog does what it can to prioritise its workload.
Calls for clarity
It’s reflective of recent political chaos that Labour’s announcement that it would avoid tampering too much with financial services rules was so roundly welcomed. To many, the opposition party is seen as a much-needed return to stability after years of Brexit turmoil. But pockets of possible contention remain: crypto enthusiasts fear Labour is not as excited about the asset class as the current government and want more clarity as to the market’s future. I’m also hearing questions about how Labour’s pro-business agenda will work alongside its commitment to strengthen workers’ rights.