FCA rules out perimeter review

The FCA has made a big decision not to carry out a perimeter review, recommended by Sheldon Mills in his extensive report on AI, this summer. Controversially, it will ask the AI providers to add disclaimers to their large language models.

The regulator says it is already embedding the six other recommendations, essentially a programme of work to better regulate the use of AI and to deploy it in regulation. The news came in a speech by Jessica Rusu, FCA chief data, information and intelligence officer.

The Financial Times reported this as the FCA planning to embrace AI to regulate financial services. The website CIO reports this as Enterprises should report AI breaches and ‘near misses.’ Law firm Simmons & Simmons examines the good and bad practice published alongside the speech.

Octo Members takes a dim view of the decision not to review the perimeter, of asking not telling AI firms to add disclaimers and indeed how the FCA went about rejecting the recommendation calling it a blunder.

In other news, Citywire New Model Adviser reports that 7IM has payed out trapped private debt investors using its PI insurance. Investors received their money back four years after a suspension left them holding illiquid debt and 7IM set aside £5.7m to compensate clients.

Fintel has bought Mortgage Brain in £38.4mn deal to ‘create a connected ecosystem’. FTAdviser reports.

Aviva is set to launch a low-cost advice service which it claims will be 50 per cent cheaper than typical advice. It will encourage IFAs to white label the service too. Again, FTAdviser reports.

Consolidator Fairstone has acquired Taunton-based 1st Financial Group, adding assets of £125m. Money Marketing reports.