Threats to financial system ‘on steroids’ after AI boom, FCA chief warns

The unchecked rise of artificial intelligence means the level of risk facing the financial system is currently on steroids , according to the boss of the Financial Conduct Authority, who warned that excessive tick-box rulemaking would fail to keep pace with increasingly complex threats. Speaking at a City of London dinner, Nikil Rathi said risks to Britain s financial markets were graver than ever, urging regulators to avoid adopting an analogue approach in a digital age . The threats to market integrity are as serious as I have seen them, the watchdog boss said. Unprecedented volatility, concentration risks, new forms of market abuse and rampant cross-border financial crime: fast-emerging technologies are putting these on steroids. Rathi, who has run the UK s largest financial watchdog since 2020, was speaking after several global regulators sounded the alarm over the threat that rapid advancements in frontier AI were posing to key infrastructure like payments, energy