As the financial services industry piles billions of pounds into artificial intelligence (AI), firms are lacking adequate measures to maintain safe usage, according to new figures.
Fresh data from Big Four accountancy giant EY reveal 26 per cent of companies have no or limited controls in place to ensure AI systems adhere to laws and regulation.
Just under a quarter said they lack sufficient controls in place to protect against unauthorised access or corruption.
Preetham Peddanagari, EY’s UK financial services tech consulting leader, told City AM: “Without robust oversight and governance frameworks, the sector risks leaving itself and its customers exposed to significant threats.”
This week the UK’s financial watchdog confirmed it was not planning on developing any additional regulations concerning AI.
The Financial Conduct Authority said ahead of the launch of its “supercharged” AI sandbox – a regulatory sandbox launched with Nvidia to provide firms with tech resources – that it will rely on existing framework to mitigate risks.
Financial services bet on AI
It comes as bosses across the sector turn bullish on the tech with more than half looking to up their investment in the next 12 months.
Businesses across the financial services industry have begun incorporating AI into their operations through landmark partnerships.
FTSE 100 giant NatWest and fintech SME lender OakNorth have both partnered with Sam Altman’s OpenAI whilst the likes of Lloyds have set up their own “Centre for Excellence and Advanced Analytics”.
The banking industry alone is projected to plough over £1.8bn into AI by 2030.
Businesses have listed “proficiency” and “efficiency” among their top uses for the new tech.
Preetham said: “When firms talk about ‘efficiency’, they mean automating the repetitive, time-consuming tasks—freeing up people to focus on what really moves the needle.
“‘Proficiency’ is about using AI to tackle complex problems faster and more accurately than ever before.”
The new data from EY revealed nearly six in ten firms were using AI to automate routine tasks whilst 62 per cent were using it to simplify complex tasks that would otherwise require professionals to have technical or academic training.