ANALYSIS: Proposed SEC Regs Won’t Allow Advisers to Sidestep AI

If 2023 is the year parents need to talk with their school-aged kids about using artificial intelligence appropriately, then 2024 will be the year that the SEC will have a similar talking-to with investment advisers regarding their ongoing use of the technology.

AI, such as deep learning or machine learning, has been around in one form or another in the investment management industry for years, and it’s almost inextricably interwoven into many operational and investment decision-making workflows. So, the SEC’s “talk” with investment advisers will be more like a long overdue—yet notably indirect—intervention, perhaps predicated on SEC Chair ...