The so-called "AI shuffle" refers to the use of artificial intelligence (AI) technology to conduct false propaganda in the financial industry.
U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler denounced the “AI shakeout” and took regulatory action against two companies.
Gensler condemned the misuse of artificial intelligence and said such activities "may violate securities regulations." Gensler made the remarks on March 18 as the SEC filed lawsuits and took regulatory action against the artificial intelligence shake-up, which refers to members of the financial sector making false claims about the use of AI.
Artificial Intelligence Shuffle
Gensler warned that investment advisers and brokers may claim they use AI to deliver higher investment returns. He also hinted that executives at public companies may try to boost stock prices by discussing their use of AI.
Gensler emphasized that all statements must be accurate, saying: "At the SEC, we want to make sure these people tell the truth. In essence, they should say what they are doing."
Gensler pointed out that artificial intelligence technology has unprecedented transformative potential, with an impact comparable to that of the Internet, and said that AI has been used to improve "inclusion, efficiency and user experience" within the financial system.
Two AI-related lawsuits settled
Gensler’s announcement comes in conjunction with new AI-related lawsuits and settlements filed by the SEC.
The SEC charged and settled two investment advisory firms, Delphia (USA) Inc. and Global Predictions Inc., for making false and misleading statements about their use of AI.
Delphia claims it uses AI combined with its data to predict which companies are about to "go big" and invest in them early. Meanwhile, Global Predictions falsely claims to be the “first regulated AI advisor” and claims to provide “professional AI-driven predictions.”
SEC Enforcement Director Gurbir Grewal said in a statement: "Neither company has the AI capabilities they claim... In short, this is the so-called AI washout, and it harms investors."
As part of the settlement, Delphia and Global Predictions paid civil penalties of $225,000 and $175,000, respectively. The settlement alleges the companies violated existing marketing rules under the Advisers Act and certain other securities regulations.
The SEC previously proposed rules in 2023 to regulate the use of artificial intelligence in financial markets. However, the proposal has yet to make any substantial progress after facing opposition in the Senate. #SEC #金融监管
