European Union
Fake news reports and disinformation campaigns driven by generative AI pose a significant risk to causing bank runs, according to a new study out of the U.K.
Per the research firm, Say No to Disinfo, and communications company Fenimore Harper, generative AI systems can easily be leveraged to create fake stories appearing on social media that suggest banks suffer from specific security deficiencies or that their depositors’ money is not safe.
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“As AI is making disinformation campaigns easier, cheaper, quicker and more effective than ever before, the emerging risk to the financial sector is rapidly growing but often overlooked,” the report said. It also notes that web-based and mobile banking transactions can transfer an account’s funds in seconds. Specifically, the study found that for every ~$12 worth of social media advertising spent, scammers could pull in as much as $1.2 million in fraudulent spending.
This potential danger demands that banks and other financial institutions monitor account withdrawals to identify when false information instigates their customer behavior, according to the study. “Whilst we believe an industry event like this is unlikely, it is still possible, so it’s essential that financial institutions are prepared,” Woody Malouf, Revolut’s head of financial crime, told Reuters.
However, the financial institutions reportedly remain bullish on the emerging technology. “Banks are working hard to manage and mitigate risks around AI and the regulatory authorities are looking at the potential financial stability challenges the technology poses,” UK Finance told Reuters. This news comes as AI companies and advocates meet in Paris as part of the AI Summit in France occurring this week where JD Vance previously argued that the U.S. can, and must, produce “the most powerful” artificial intelligence processors in the world.
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