WASHINGTON—Banking regulators in the United States and Europe are intensifying their scrutiny of artificial intelligence as concerns mount that increasingly autonomous AI systems could expose financial institutions to cyberattacks, operational disruptions and broader threats to financial stability.
According to Reuters, which cited sources familiar with the matter, regulators are examining whether banks have adequate safeguards to control advanced AI systems, manage their dependence on outside technology providers and recover from potentially significant disruptions.
The increased oversight reflects growing recognition that rapid advances in AI could introduce risks faster than financial institutions and their regulators can develop protections, Reuters reported.
U.S. Regulators Asking New Questions
Three major U.S. banking regulators, including the Federal Reserve, have begun questioning banks about their use of advanced AI models, expanding upon earlier examinations of the technology, two sources told Reuters.
According to the report, regulators are seeking information about several areas, including:
- Whether banks are using AI technology developed in China.
- Whether financial institutions are deploying AI agents to manage cybersecurity operations.
- Whether banks can effectively monitor, restrict or shut down autonomous AI systems.
- How institutions are managing the operational and security risks associated with increasingly sophisticated AI applications.
The inquiries suggest regulators are becoming more concerned about the possibility that AI systems operating with limited human supervision could create vulnerabilities or take actions that financial institutions cannot readily reverse.
Reuters reported that the heightened scrutiny could lead to greater investments in cyber recovery capabilities, closer examination of banks’ relationships with outside technology vendors and more formal regulatory guidance in some jurisdictions.
European Regulators Also Raising Concerns
The increased attention is not limited to the United States.
According to Reuters, the Bank of England and European Central Bank are urging financial institutions to strengthen their recovery and contingency plans amid concerns that advances in AI could disrupt financial markets sooner than previously anticipated.
Three sources told Reuters that European regulators are particularly focused on banks’ ability to withstand and recover from disruptions involving AI technology.
The concerns extend beyond individual financial institutions to the possibility that widespread reliance on similar AI systems or technology providers could create vulnerabilities affecting multiple banks simultaneously.
Cybersecurity Threats Fueling Concerns
The regulatory scrutiny comes as financial industry executives and cybersecurity companies warn that AI is creating new opportunities for malicious actors.
JPMorgan Chase CEO Jamie Dimon has called on corporate leaders to participate in a U.S.-focused industry initiative designed to address emerging AI security threats, according to PYMNTS.
Meanwhile, cybersecurity company CrowdStrike recently reported that an individual believed to be operating from China likely used a Chinese-developed AI agent and Anthropic’s Claude Code in cyberattacks targeting banks in South Korea.
PYMNTS also reported that rogue AI agents developed by OpenAI breached the Hugging Face AI platform during the summer.
