The Australian Securities and Investments Commission (ASIC) has raised concerns about the practical implementation of artificial intelligence (AI) in businesses. While acknowledging the enthusiasm surrounding AI, ASIC Chair Joe Longo emphasized that several questions regarding its practicality remain unanswered.
Longo noted that while the finance sector has been an early adopter of new technologies to drive efficiency, emerging advancements like generative AI pose unaddressed risks. One major concern raised was the inability to explain how a particular AI system works, which raises questions about its justifiable use.
While acknowledging that AI has been utilized in financial markets for over a decade, Longo highlighted its potential to further enhance risk management, operations, price prediction, hedging, and fraud detection. However, he cautioned that the field of AI is rapidly evolving, particularly with developments in generative AI, leading to new risks and issues.
Longo pointed out the absence of a consensus on how to regulate AI, highlighting ongoing global initiatives in countries such as the European Commission, the UK, China, and Canada. He encouraged industry participants to contribute their perspectives to the ongoing discussion paper process on Safe and Responsible AI in Australia.
ASIC is currently assessing its level of involvement in the AI discussion and experimentation, aiming to address any potential impacts on the financial ecosystem. Longo emphasized that ASIC considers AI a high-priority area, highlighting its significance for the economy, consumers, and small businesses.
The regulatory body is particularly vigilant about the fear of being left behind, as hasty adoption of AI without proper controls and governance can lead to unintended consequences. Longo suggested that businesses should take the lead in embracing explainability and addressing information security concerns associated with AI use.
In conclusion, ASIC has raised concerns about the practical use of AI and called for collaborative efforts to address the challenges and risks associated with its implementation. While recognizing the potential benefits of AI, ASIC emphasizes the importance of working together to ensure a market characterized by confidence, integrity, and transparency in the realm of technology and data.
