Guard­ing Against Risks in AI­Based In­vest­ment

Beijing Review - - Business Market Watch -

man­age­ment plat­forms try to at­tract funds by ly­ing about in­vest­ment re­turns and ex­ag­ger­at­ing the strength of AI tech­nolo­gies, but ac­tu­ally they are en­gag­ing in Ponzi schemes and other fraud ac­tiv­i­ties; and some plat­forms mis­ap­pro­pri­ate in­vestors’ funds, which may cause liq­uid­ity crises.

On the other hand, even in li­censed in­sti­tu­tions, AI-based in­vest­ment ac­tiv­i­ties may also lead to many prob­lems: Is ro­bot in­vest­ment com­pli­ant with reg­u­la­tions? How will in­vest­ment re­turns be di­vided? Who will bear the losses? Who are the ac­tual con­trollers of in­vest­ment ac­counts in mo­bile phone ap­pli­ca­tions? How to deal with the le­gal risks of “per­sons act­ing in con­cert” in the stock mar­ket when in­vestors hire the same ex­cel­lent ro­bot to in­vest in the mar­ket? And how to deal with the eth­i­cal risks once in­vest­ment robots dam­age the in­ter­ests of oth­ers in or­der to max­i­mize in­vest­ment re­turns?

Th­ese prob­lems in­volve not only le­gal and eth­i­cal risks, but also the sta­bil­ity and sound de­vel­op­ment of the fi­nan­cial sys­tem. For in­stance, since AI-based in­vest­ment is closely con­nected with In­ter­net com­pa­nies, it in­volves much more in­vestors than tra­di­tional in­vest­ment meth­ods. The risks will there­fore be much more widely spread via the In­ter­net, and more likely to cause sys­temic fi­nan­cial risks. More­over, AI-based in­vest­ment it­self is vul­ner­a­ble to risks such as at­tacks from hack­ers, In­ter­net break­down, al­go­rithm de­fects, tech­nol­ogy risks, unau­tho­rized op­er­a­tions and the leak­age of per­sonal in­for­ma­tion.

The Na­tional Fi­nan­cial Work Con­fer­ence, which con­vened in Beijing on July 14-15, vowed to res­o­lutely pun­ish be­hav­iors se­verely dis­turb­ing the fi­nan­cial mar­ket or­der, strictly reg­u­late trans­ac­tion be­hav­iors in the fi­nan­cial mar­kets, en­hance su­per­vi­sion of In­ter­net-based fi­nance and strengthen the re­spon­si­bil­ity of fi­nan­cial in­sti­tu­tions in pre­vent­ing risks.

This re­quires re­lated gov­ern­ment de­part­ments and in­sti­tu­tions to ac­tively pre­vent po­ten­tial fi­nan­cial risks aris­ing from AI-based in­vest­ment, dis­cover and dis­pose of those risks as early as pos­si­ble and guide such in­vest­ment to bet­ter serve the real econ­omy and in­vestors.

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