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- Vol. 6 Issue 3
- Article
Ethical and Regulatory Challenges of Generative AI in Financial Services: Governance Gaps and Risk-Based Guidelines
Authors
1 Artificial Intelligence and Machine Learning, Madras University, Tamil Nadu, India.
Article Information
- DOI
- No DOI
- Published In
- Volume 6, Issue 3 (2026)
- Published Online
- May-June 2026
- Pages
- 129-135
- Article Type
- Original Article
- Check for updates
- No DOI available for cross-reference
References
1. Bartlett, R., Morse, A., Stanton, R., & Wallace, N. (2022). Consumer-lending discrimination in the FinTech era. Journal of Financial Economics, 143(1), 30–56.
2. Basel Committee on Banking Supervision (BCBS). (2021). Principles for the sound management of operational risk. Bank for International Settlements.
3. Board of Governors of the Federal Reserve System. (2011). Supervisory guidance on model risk management (SR 11-7). Federal Reserve.
4. Carlini, N., Tramèr, F., Wallace, E., Jagielski, M., Herbert-Voss, A., Lee, K., … Raffel, C. (2021). Extracting training data from large language models. Proceedings of the 30th USENIX Security Symposium, 2633–2650.
5. Consumer Financial Protection Bureau (CFPB). (2023). Circular 2023-03: Adverse action notification requirements in connection with credit decisions based on artificial intelligence. CFPB.
6. Deloitte. (2023). The state of generative AI in financial services: 2023 survey. Deloitte Insights.
7. European Data Protection Board (EDPB). (2024). Opinion 28/2024 on certain data protection aspects related to the processing of personal data in the context of AI models. EDPB.
8. European Parliament. (2024). Regulation (EU) 2024/1689 of the European Parliament and of the Council of 13 June 2024 laying down harmonised rules on artificial intelligence (Artificial Intelligence Act). Official Journal of the European Union.
9. Federal Reserve Bank of Boston. (2019). the state of synthetic identity fraud in the U.S. payments ecosystem. Federal Reserve Bank of Boston.
10. Financial Crimes Enforcement Network (FinCEN). (2023). FinCEN alert on the increasing use of deepfake media and synthetic content to commit financial fraud (FIN-2023-Alert004). U.S. Department of the Treasury.
11. Financial Industry Regulatory Authority (FINRA). (2020). Report on artificial intelligence in the securities industry. FINRA.
12. Financial Industry Regulatory Authority (FINRA). (2023). 2023 FINRA annual regulatory oversight report. FINRA.
13. Financial Stability Board (FSB). (2023). Financial stability implications of artificial intelligence. FSB.
14. McKinsey & Company. (2023). The economic potential of generative AI: The next productivity frontier. McKinsey Global Institute.
15. National Institute of Standards and Technology (NIST). (2023). Artificial intelligence risk management framework (AI RMF 1.0) (NIST AI 100-1). U.S. Department of Commerce.
16. Office of the Comptroller of the Currency (OCC). (2011). OCC Bulletin 2011-12: Sound practices for model risk management: Guidance on model risk management. OCC.
17. Office of the Comptroller of the Currency (OCC). (2023). OCC Bulletin 2023-17: Third-party relationships: Interagency guidance on risk management. OCC.
18. Oliver Wyman. (2024). AI in financial services: From pilots to production. Oliver Wyman.
19. Organisation for Economic Co-operation and Development (OECD). (2023). OECD AI principles (updated). OECD.
20. Securities and Exchange Commission (SEC). (2023). Conflicts of interest associated with the use of predictive data analytics by broker-dealers and investment advisers (Release No. IA-6383). SEC.
21. South China Morning Post. (2024, February 4). Finance worker pays out $25 million after video call with deepfake 'chief financial officer.' South China Morning Post.
2. Basel Committee on Banking Supervision (BCBS). (2021). Principles for the sound management of operational risk. Bank for International Settlements.
3. Board of Governors of the Federal Reserve System. (2011). Supervisory guidance on model risk management (SR 11-7). Federal Reserve.
4. Carlini, N., Tramèr, F., Wallace, E., Jagielski, M., Herbert-Voss, A., Lee, K., … Raffel, C. (2021). Extracting training data from large language models. Proceedings of the 30th USENIX Security Symposium, 2633–2650.
5. Consumer Financial Protection Bureau (CFPB). (2023). Circular 2023-03: Adverse action notification requirements in connection with credit decisions based on artificial intelligence. CFPB.
6. Deloitte. (2023). The state of generative AI in financial services: 2023 survey. Deloitte Insights.
7. European Data Protection Board (EDPB). (2024). Opinion 28/2024 on certain data protection aspects related to the processing of personal data in the context of AI models. EDPB.
8. European Parliament. (2024). Regulation (EU) 2024/1689 of the European Parliament and of the Council of 13 June 2024 laying down harmonised rules on artificial intelligence (Artificial Intelligence Act). Official Journal of the European Union.
9. Federal Reserve Bank of Boston. (2019). the state of synthetic identity fraud in the U.S. payments ecosystem. Federal Reserve Bank of Boston.
10. Financial Crimes Enforcement Network (FinCEN). (2023). FinCEN alert on the increasing use of deepfake media and synthetic content to commit financial fraud (FIN-2023-Alert004). U.S. Department of the Treasury.
11. Financial Industry Regulatory Authority (FINRA). (2020). Report on artificial intelligence in the securities industry. FINRA.
12. Financial Industry Regulatory Authority (FINRA). (2023). 2023 FINRA annual regulatory oversight report. FINRA.
13. Financial Stability Board (FSB). (2023). Financial stability implications of artificial intelligence. FSB.
14. McKinsey & Company. (2023). The economic potential of generative AI: The next productivity frontier. McKinsey Global Institute.
15. National Institute of Standards and Technology (NIST). (2023). Artificial intelligence risk management framework (AI RMF 1.0) (NIST AI 100-1). U.S. Department of Commerce.
16. Office of the Comptroller of the Currency (OCC). (2011). OCC Bulletin 2011-12: Sound practices for model risk management: Guidance on model risk management. OCC.
17. Office of the Comptroller of the Currency (OCC). (2023). OCC Bulletin 2023-17: Third-party relationships: Interagency guidance on risk management. OCC.
18. Oliver Wyman. (2024). AI in financial services: From pilots to production. Oliver Wyman.
19. Organisation for Economic Co-operation and Development (OECD). (2023). OECD AI principles (updated). OECD.
20. Securities and Exchange Commission (SEC). (2023). Conflicts of interest associated with the use of predictive data analytics by broker-dealers and investment advisers (Release No. IA-6383). SEC.
21. South China Morning Post. (2024, February 4). Finance worker pays out $25 million after video call with deepfake 'chief financial officer.' South China Morning Post.
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