Gensler's warnings come amid Wall Street's ongoing enthusiasm for AI investments. He also highlighted the potential systemic risks of AI to financial stability, particularly the widespread use of the same underlying AI models across financial entities. Gensler has previously expressed concerns about companies' growing reliance on a few dominant AI models, warning that this could lead to systemic risk in a future financial crisis.
Key takeaways:
- SEC chief Gary Gensler warns companies to be clear about their use of AI and avoid making false claims about its impact on their business.
- Gensler emphasized the potential systemic risks of AI to financial stability, particularly in the context of a future financial crisis.
- He also cautioned against 'AI washing', where companies falsely claim the use of AI models or misrepresent their application, which could potentially breach securities laws.
- Gensler's comments come amid a surge in AI investments on Wall Street, with stocks in major tech companies gaining on bullish updates related to AI.