Many companies are jumping on the artificial intelligence (AI) bandwagon, touting opportunities and partnerships, but the regulator is watching. 澳洲幸运5官方开奖结果体彩网:Securities and Exchangꦿe Commissionꦯ (SEC) Chair 澳洲幸运5官方开奖结果体彩网:Gary Gensler warned corporations to make accurate representations about their AI-related moves to ens🍒ure investors are not deceived.

AI An Earnings Buzzwor🍬d But Regulator Is Watching

Gensler said that AI is the "most transformative technology of our time, on par with the internet and mass production of automobiles" in prepared remarks before the National Press Club on Monday. However, that high praise came with a stern warning for listed companies promoting AI opportunities to make the most of the hype.

"Public companies making statements on AI opportunities and risks need to take care to ensure that material disclosures are accurate and don’t deceive investors," said Gensler.

AI has become a buzzword for corporations after the success of 澳洲幸运5官方开奖结果体彩网:Microsoft's early integration of OpenAI's ChatGPT. Many of the company's competitors have since 澳洲幸运5官方开奖结果体彩网:jumped on the bandwagon for fear of missing o✨ut on AI-related stock gains.

A record 110 companies in the S&P 500 universe mentioned AI in their quarterly earnings during May 15-25, 2023, according to FactSet data. Information technology and Communications services— the two sectors home to most tech giants such as Apple (AAPL), Amazon (AMZN), Microsoft (MSFT) and Alphabet (GOOGL)—saw the highest number and percentage of companies mentioning AI on their earnings calls.

SEC Chair Warns Of AI Risks

Among the risks Gensler warned about is the the ability for an AI-driven model to provide factually correct and bias-free advice, which he said was a concern in areas such as credit scoring or loan recommendations. The advice, Gensler said, "must be in the best interests of the clients and retail customer and not place their interests ahead of investors’ interests."

He also said that AI brings the risk of accentuating the dominance of a small number of tech platforms, as well a propagation of false information. For example, false AI-generated content led to a rumor of Gensler's resignation a few days ago. He said that AI-drive information could even lead to investor losses, or a financial crisis if herding becomes commonplace.

This is not the first time Gensler has sounded the alarm about the risks of AI for investors. In a 2020 paper written by Gensler (then a professor at Massachusetts Institute of Technology) and Lily Bailey, the authors warned that "(e)xisting financial sector regulatory regimes—built in an earlier era of data analytics technology—are likely to fall short in addressing the risks posed by deep learning."