On Wednesday, Reuters hosted a Newsmaker event in London with Charles Randell, Chair of the Financial Conduct Authority.
In his first major public speech since becoming chair in April, Randell outlined the opportunities and risks from combining Big Data with artificial intelligence and behavioural science, setting out the fundamental ethical and regulatory questions which technological developments can pose for financial firms, regulators and society.
Following his speech, Reuters Breakingviews Editor Peter Thal Larsen led an audience discussion with Randell on innovation in financial services and the role of the regulator.
Among the highlights:
–Randell said Britain’s banks and insurers want to stick to global standards on financial regulation after Brexit and are not calling for a “regulatory race to the bottom” to win business from European rivals.
–On Big Data, he said financial firms must take the lead in spelling out how they will use data collected from customers or they could face new rules. “Trust requires good communication so that consumers understand and accept a firm’s approach to using their data. By good communication, I don’t mean pages and pages of obscure disclosures, disclaimers and consents. I mean short and readable statements which make it clear what firms will and won’t do with their customers’ data.”
–He warned of the danger of a new ‘algocracy’, saying “society in general and policy makers in particular need to think about how to mitigate the risk that an algocracy exacerbates social exclusion and worsens access to financial services in the way that it identifies the most profitable or the most risky customers.”
The full interview can be viewed here .
[Reuters Press Blog]
Jamie.Austin at thomsonreuters.com