Banking regulator warns financial firms about AI risks
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A leading federal banking regulator is warning banks about the potential risks of implementing artificial intelligence (AI) tools into their systems.
The Office of the Comptroller of the Currency (OCC) is an independent bureau of the Treasury Department that charters, regulates and supervises national banks, federal savings associations and federal branches and agencies of foreign banks. The OCC’s National Risk Committee published its semi-annual risk report, which flagged AI as an emerging risk for financial institutions to be aware of as they look to incorporate AI tools within internal and customer-facing use cases.
«Advances in computing capacity, combined with greater availability of data and improvements in analytical techniques, continue to expand opportunities for banks to leverage AI for various risk management and operational purposes. AI use cases have varied widely and include customer chatbots, fraud detection, and credit scoring,» the agency wrote.
«Many risks can arise from all types of AI, such as lack of explainability, reliance on large volumes of data, potential bias, privacy concerns, third-party risk, cybersecurity risks, and consumer protection concerns,» the OCC explained. «The use of generative AI may pose additional risks including providing inaccurate responses that appear credible.»
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The Comptroller of the Currency, one of the leading federal banking regulators, warned banks about potential risks stemming from AI's deployment. (Photographer: Ting Shen/Bloomberg via Getty Images / Getty Images)
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