The Financial Stability Board (FSB) published a paper on November 14 analyzing the implications of artificial intelligence (AI) in financial services. While acknowledging AI's potential to enhance operational efficiency and regulatory compliance, the FSB warns that it may also amplify systemic vulnerabilities, such as third-party dependencies, cyber risks, and financial fraud. They highlighted concerns over the use of generative AI in perpetrating fraud and disinformation. To address these risks, the FSB recommends improving data monitoring on AI developments and increasing regulatory engagement with the private sector. They advocate for assessing the adequacy of current regulatory frameworks and enhancing supervisory capabilities for AI oversight in finance.

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