{
  "id": 15598568,
  "title": "FCA sounds the alarm on rise of unregulated AI financial advice",
  "url": "https://urgent.news/2026/10/19/fca-sounds-the-alarm-on-rise-of-unregulated-ai-financial-advice",
  "topic": "ai",
  "section": "AI",
  "published": "2026-10-19T10:27:40.000Z",
  "source": {
    "name": "City AM",
    "slug": "city-am",
    "url": "https://www.cityam.com/fca-sounds-the-alarm-on-rise-of-unregulated-ai-financial-advice/"
  },
  "original_language": "en",
  "account": "The City watchdog is warning AI providers to take greater steps in safeguarding consumers as more individuals turn to the technology for financial decision-making. The Financial Conduct Authority (FCA) is asking AI companies to provide better assistance to consumers who are increasingly relying on platforms and chatbots, like Gemini and Chat GPT, for information and investment advice. Brits have been flocking to chatbots for guidance as the industry-wide effort to encourage more people to invest in the stock market continues. Traditional financial advice, however, remains inaccessible to many. While regulated firms have started incorporating AI into their services, a significant portion of young investors still incorrectly believe that chatbots are regulated by the FCA, which leaves them without a way to seek help or compensation if the advice proves to be incorrect. Jessica Rusu, the FCA's chief data, information officer, cautioned that this technology can significantly expand access to financial tools and information, but it also risks blurring the line between regulated and unregulated activities, and the protections consumers receive. \"We are calling on AI providers to help consumers understand the limits of financial information and advice generated by their models through clear, proportionate, and consistent disclaimers,\" said Rusu during a speech on Monday. Firms have implemented AI for various reasons, such as improving product design and providing support based on the severity of the complaint. However, some firms are using the technology in \"poor practice\" which does not enhance consumer outcomes. Rusu argued that firms are developing tools without a clear need, excluding vulnerable consumers, or overstating their capabilities, ultimately failing to assist effectively. Additionally, many firms are failing to invest adequately in governance, leaving them without accountability, risk-based controls, or human oversight, while others lack proper cyber insurance. Rusu emphasized that while the regulator is focusing on ensuring providers adhere to the Consumer Duty, which sets standards for consumer protection, it is also working to improve AI in financial services. The FCA is deploying AI across its operations to target the most significant harms, upskill staff, and invest in technology, including tools for oversight of anti-money laundering firms and supervising small, wholesale market transactions. Financial services have expressed support for the regulator's stance on the technology, acknowledging it as a \"significant and welcome step.\" Sam Christopher, the proposition director at Quilter, noted that the industry needs to collaborate closely with the FCA as they learn more about the opportunities and risks, ensuring they remain agile enough to innovate while protecting customers from harm. However, Christopher urged the regulator not to become overly prescriptive as the technology and understanding of it continue to evolve, arguing that regulation should adapt alongside the technology instead of hindering or slowing it down.",
  "summary": "The City watchdog is calling on AI providers to go further in protecting consumers as more people turn to the technology to make financial decisions. The Financial Conduct Authority (FCA) is urging AI firms to do more to help consumers who are increasingly relying on generic platforms and chatbots, such as Gemini and Chat GPT, [...]",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}