US SEC Investigates AI Usage by Investment Advisory Firms... "Likely for Regulatory Purposes"

The U.S. Securities and Exchange Commission (SEC) has launched an investigation into the use of artificial intelligence (AI) by investment advisory firms.

According to the Wall Street Journal (WSJ) on the 10th (local time), the SEC recently requested information from investment advisory firms on AI-related topics as part of a comprehensive survey on AI usage.

The SEC asked for detailed submissions regarding AI-powered marketing materials, AI algorithm models used in client portfolio management, and more.

This investigation comes as the investment advisory industry has either adopted AI technology or is preparing to do so. BlackRock operates an AI research group led by a former Google statistician and a Stanford University professor. JP Morgan Chase runs an AI research team in New York, and Fidelity Investments is focusing on AI’s asset management capabilities. Goldman Sachs has also stated that AI can assist investors and help detect investment trends and patterns that are difficult for humans to identify.

There is speculation in the market that the SEC’s investigation may be aimed at regulating AI usage.

Earlier, SEC Chair Gary Gensler warned that "excessive reliance on AI could cause financial instability and push us toward an unintended cliff." He also expressed concerns about companies making exaggerated claims about AI’s capabilities.

Amy Jane Longo, litigation and enforcement practice partner at the law firm Loeb & Loeb, said, "AI technology is already being used too extensively," adding, "It may be quite difficult for the SEC to put the brakes on it."

This content was produced with the assistance of AI translation services.