Can AI become part of the solution to curb misleading financial advertising? ASIC is going to start using natural language processing technology to detect problematic financial advice and misleading internet advertisements for financial products. The financial regulator is looking at artificial intelligence as a way to identify misconduct that in the past could have slipped through the cracks.
According to the Financial Review, ahead of the annual regtech industry event, Australian Securities and Investments Commission commissioner John Price said there are plans to roll out the sophisticated technology systems that ASIC uses to monitor trading in financial markets more broadly. But data quality will need to improve for any AI system to become reliable, he added.
The problem simply stated is that there is more financial advice and advertising being promoted on platforms such as Google through advertising than can be adequately monitored. Using technology such as Artificial Intelligence allows for more monitoring by teaching its systems to look for particular words, or excessive rates of return, that then throw up red flags for ASIC investigators.
“Promotions can be just as important as selling through a prospectus, and we can look for excessive promotion of benefits without sufficient talk about risks,” ASIC Commissioner John Price said, “We want to show a leadership role by using regtech ourselves.”