Matt Egan’s Post

Some points of interest (from the article) for me in relation to #insurane and #reinsurance: 1) "Another concern: #AI models can at times churn out biased results. And that could be a major problem in the real world, especially when it comes to making financial decisions like who gets a loan" Note: From an insurance or reinsurance point-of-view (POV), who receives a policy for coverage? 2) “Insufficient or faulty #data could also perpetuate or introduce new biases in #financial decision making,” Yellen will say, according to the prepared remarks." 3) "One major challenge facing AI that Yellen does not address in her speech excerpts: so-called hallucinations. AI models have a history of making stuff up, often in a convincing way." 4) "Such hallucinations have previously gotten #lawyers in trouble when they cited case law that did not exist." 5) "Yellen is expected to emphasize that #regulators plan to continue to monitor AI’s impact on financial stability." So this leads to this question, and I welcome anyone to provide an answer or responses in the comments to this posting: 1) How is AI going to be #tested before it is released to a productional status or production environments? 2) Will it go through the best practice #testing rigors of unit testing, functional testing, system testing, user acceptance and 1-2-3 production testing in limited production environments? #ftc #financialservices #banking #datasecuritybreach #lessonslearned #healthcaresystem #datasecurity #databreachincident #security #finance #finacialdata #personaldata #finance #systemsecurity #hospitals #hipaa #cybersecurity #healthcare #cybercrime #informationsecurity #pii #phi #databreach #cyberattack #dataprotection #insurers #coo #cfo #ceo #cio #liability #careers #business #insuretech #tech #claim #technology #it #europe #regulation #risks #india #fintech #propertyandcasualty #claims #managementconsulting #leadership #executivesandmanagement #cto #riskmanagement #insuranceindustry #insurancecompanies #consulting #financialservices #accenture #bcg #businesstransformation #deloitte #ey #kpmg #pwc #mckinsey #bain #wipro #infosys #techmahindra #cognizant #tata #industry #analytics #datascience #innovation #claimsmanagement #tcs #hcl #management #compliance #risk #computersecurity #hacking #government #regulatory #computersecurity #financialservices #phishing #phishingscams #phishingattacks #phishingattackprevention #fbi #ciso #cybersecurity #chatgpt #federalreserve #unitedstatescongress #hackers #unitedstatessenate #systemhack

Janet Yellen Sounds Alarm on ‘Significant Risks’ of AI in Finance. On the opportunity side, Yellen will note how AI has already been used by investors to support forecasting and portfolio management and by banks to fight fraud and support customer service. The problem is that many AI models operate as a “black box,” meaning their inner workings are impenetrable to outsiders. In other words, if many investors are all relying on tools that produce the same outcome, it could cause crowded market positions that exacerbate market moves, both to the upside or downside. Another concern: AI models can at times churn out biased results. And that could be a major problem in the real world, especially when it comes to making financial decisions like who gets a loan. One major challenge facing AI that Yellen does not address in her speech excerpts: so-called hallucinations. AI models have a history of making stuff up, often in a convincing way. Such hallucinations have previously gotten lawyers in trouble when they cited case law that did not exist. “We’ve engaged with the public and private sectors on using AI to detect some of the greatest risks we face, from money laundering, to terrorist financing, to sanctions evasion,” Yellen plans to say. International AI Association: Addressing AI issues. Read more: https://lnkd.in/gzXPD2gT #AI. #JanetYellen. #treasury. #chatgpt. #Gemini. #finance. #riskmanagement

Janet Yellen Sounds Alarm on ‘Significant Risks’ of AI in Finance. On the opportunity side, Yellen will note how AI has already been used by investors to support forecasting and portfolio management and by banks to fight fraud and support customer service. The problem is that many AI models operate as a “black box,” meaning their inner workings are impenetrable to outsiders. In other words, if many investors are all relying on tools that produce the same outcome, it could cause crowded market positions that exacerbate market moves, both to the upside or downside. Another concern: AI models can at times churn out biased results. And that could be a major problem in the real world, especially when it comes to making financial decisions like who gets a loan. One major challenge facing AI that Yellen does not address in her speech excerpts: so-called hallucinations. AI models have a history of making stuff up, often in a convincing way. Such hallucinations have previously gotten lawyers in trouble when they cited case law that did not exist. “We’ve engaged with the public and private sectors on using AI to detect some of the greatest risks we face, from money laundering, to terrorist financing, to sanctions evasion,” Yellen plans to say. International AI Association: Addressing AI issues. Read more: https://lnkd.in/gk-gphDB #AI. #JanetYellen. #treasury. #chatgpt. #Gemini. #finance. #riskmanagement

U.S. Department of the Treasury aims to better understand the opportunities and challenges that AI presents to financial institutions. Learn more: https://lnkd.in/efS2Zcdu #ArtificialIntelligence #FinancialServicesIndustry

Janet Yellen Sounds Alarm on ‘Significant Risks’ of AI in Finance. On the opportunity side, Yellen will note how AI has already been used by investors to support forecasting and portfolio management and by banks to fight fraud and support customer service. The problem is that many AI models operate as a “black box,” meaning their inner workings are impenetrable to outsiders. In other words, if many investors are all relying on tools that produce the same outcome, it could cause crowded market positions that exacerbate market moves, both to the upside or downside. Another concern: AI models can at times churn out biased results. And that could be a major problem in the real world, especially when it comes to making financial decisions like who gets a loan. One major challenge facing AI that Yellen does not address in her speech excerpts: so-called hallucinations. AI models have a history of making stuff up, often in a convincing way. Such hallucinations have previously gotten lawyers in trouble when they cited case law that did not exist. “We’ve engaged with the public and private sectors on using AI to detect some of the greatest risks we face, from money laundering, to terrorist financing, to sanctions evasion,” Yellen plans to say. International AI Association: Addressing AI issues. Read more: https://lnkd.in/gk-gphDB #AI. #JanetYellen. #treasury. #chatgpt. #Gemini. #finance. #riskmanagement

Janet Yellen Sounds Alarm on ‘Significant Risks’ of AI in Finance. On the opportunity side, Yellen will note how AI has already been used by investors to support forecasting and portfolio management and by banks to fight fraud and support customer service. The problem is that many AI models operate as a “black box,” meaning their inner workings are impenetrable to outsiders. In other words, if many investors are all relying on tools that produce the same outcome, it could cause crowded market positions that exacerbate market moves, both to the upside or downside. Another concern: AI models can at times churn out biased results. And that could be a major problem in the real world, especially when it comes to making financial decisions like who gets a loan. One major challenge facing AI that Yellen does not address in her speech excerpts: so-called hallucinations. AI models have a history of making stuff up, often in a convincing way. Such hallucinations have previously gotten lawyers in trouble when they cited case law that did not exist. “We’ve engaged with the public and private sectors on using AI to detect some of the greatest risks we face, from money laundering, to terrorist financing, to sanctions evasion,” Yellen plans to say. International AI Association: Addressing AI issues. Read more: https://lnkd.in/gk-gphDB #AI. #JanetYellen. #treasury. #chatgpt. #Gemini. #finance. #riskmanagement

Janet Yellen Sounds Alarm on ‘Significant Risks’ of AI in Finance. On the opportunity side, Yellen will note how AI has already been used by investors to support forecasting and portfolio management and by banks to fight fraud and support customer service. The problem is that many AI models operate as a “black box,” meaning their inner workings are impenetrable to outsiders. In other words, if many investors are all relying on tools that produce the same outcome, it could cause crowded market positions that exacerbate market moves, both to the upside or downside. Another concern: AI models can at times churn out biased results. And that could be a major problem in the real world, especially when it comes to making financial decisions like who gets a loan. One major challenge facing AI that Yellen does not address in her speech excerpts: so-called hallucinations. AI models have a history of making stuff up, often in a convincing way. Such hallucinations have previously gotten lawyers in trouble when they cited case law that did not exist. “We’ve engaged with the public and private sectors on using AI to detect some of the greatest risks we face, from money laundering, to terrorist financing, to sanctions evasion,” Yellen plans to say. International AI Association: Addressing AI issues. Read more: https://lnkd.in/gk-gphDB #AI. #JanetYellen. #treasury. #chatgpt. #Gemini. #finance. #riskmanagement

AI in Finance: Key Insights from Treasury Secretary Janet Yellen’s Speech Today, Treasury Secretary Janet Yellen spoke at an AI conference hosted by the Financial Stability Oversight Council and The Brookings Institution. Here are the main points every banking and finance professional should know: Potential AI Risks 🎲 AI models are complex and not always transparent. This can create big risks. 🚩 Current systems might not handle AI risks well. We need better ways to manage these risks. 🌐 If everyone uses the same data and models, a problem with one can affect everyone. 🔗 Reliance on a few AI developers and data providers can increase risks. If one fails, it can affect many. 📉 Poor quality data can lead to biased financial decisions. This can result in unfair outcomes. Benefits of AI 💡 AI can provide better insights and efficiencies in finance. 🚀 AI can enhance customer support and fraud detection. 🔐 Innovations in natural language processing, image recognition, and generative AI can make financial services more affordable and accessible. Treasury's Role 🤝The Treasury is working closely with financial regulators to manage AI-related risks effectively. 🔍 The Financial Stability Oversight Council (FSOC), led by Yellen, will continue to monitor AI's effects on financial stability and support scenario analysis to understand potential risks and opportunities. ⚖ AI is being used to fight money laundering, terrorism financing, and sanctions evasion, with the IRS employing AI tools to improve fraud detection. #USTreasury #JanetYellen #Finance #AI #Banking #USRegulation

AI Risks Amplifying Market Shocks and Herd Behavior, Warns Bank of England Jonathan Hall from the Bank of England's Financial Policy Committee highlights the potential dangers of AI in trading. He warns that AI could intensify market shocks and encourage herd-like behavior, stressing the importance of human oversight and safeguards. The BoE will closely examine AI's impact on financial stability in 2024, balancing its risks and benefits. #AI #Finance #Trading #MarketStability #Innovation #Regulation #FinTech https://lnkd.in/eXrPJrG8

Treasury issues request for information on use of AI in financial services Interesting article by By Peter D. Hardy & Nathaniel Botwinick on the U.S. Department of the Treasury (“Treasury”) released Request for Information on the Uses, Opportunities, and Risks of Artificial Intelligence (“AI”) in the Financial Services Sector (“RFI”). AI is a broad topic and the term is sometimes used indiscriminately; as the RFI suggests, most AI systems being used or contemplated in the financial services sector involve machine learning, which is a subset of AI. The RFI implicitly concedes that Treasury is playing “catch up” and quickly needs to learn more about AI and how industry is using it. The RFI discusses a vast array of complex issues, including anti-money laundering (“AML”) and anti-fraud compliance, as well as fair lending and consumer protection concerns – particularly those pertaining to bias. In the press release for the RFI, Under Secretary for Domestic Finance Nellie Liang stated that Treasury is seeking to understand . . . . how AI is being used within the financial services sector and the opportunities and risks presented by developments and applications of AI within the sector, including potential obstacles for facilitating responsible use of AI within financial institutions, the extent of impact on consumers, investors, financial institutions, businesses, regulators, end-users, and any other entity impacted by financial institutions’ use of AI, and recommendations for enhancements to legislative, regulatory, and supervisory frameworks applicable to AI in financial services. Treasury is seeking a broad range of perspectives on this topic and is particularly interested in understanding how AI innovations can help promote a financial system that delivers inclusive and equitable access to financial services. Continue reading the the full Article below: https://lnkd.in/e9uUAeS2 #FintechNews #Finance #ai #DigitalBanking #payments #BankingTechnology #fintech #fusionalgo #banking #temenos #p2pfintech #thinkers360