WASHINGTON (Reuters) -U.S. financial regulators have settled charges with two investment advisers over false and misleading statements about their use of artificial intelligence, or “AI washing,” the Securities and Exchange Commission said on Monday.
Toronto-based Delphia Inc and San Francisco-based Global Predictions Inc will pay a $400,000 fine to settle the civil charges, but did not admit or deny the agency’s findings, the SEC said.
“Today’s enforcement actions make clear to the investment industry – if you claim to use AI in your investment processes, you need to ensure that your representations are not false or misleading,” SEC Division of Enforcement Director Gurbir Grewal said in a statement.
“Public issuers making claims about their AI adoption must also remain vigilant about similar misstatements that may be material to individuals’ investing decisions,” Grewal added.
Representatives for the two companies could not be immediately reached for comment. Delphia will pay a $225,000 penalty while and Global Predictions will pay $175,000, the SEC said.
SEC Chair Gary Gensler in recent months has repeatedly warned companies against “AI washing,” or making false statements about their use of artificial intelligence.
(Reporting by Susan Heavey; Editing by Doina Chiacu)
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