As the financial sector continues to evolve, ASIC is stepping up to meet the challenges posed by new technologies. In its recently published 2024-25 Corporate Plan, ASIC highlights the critical role technology will play in addressing risks, particularly in the areas of artificial intelligence (AI), data analytics, and cyber resilience. But what does this mean for financial advisers?
Leveraging AI and Data Analytics for Early Risk Detection
AI and data analytics are central to ASIC’s new technological focus. These tools can help detect misconduct and identify risks more effectively. By improving its data capabilities, ASIC hopes to catch harmful practices earlier, allowing for quicker action before they cause major problems.
One of the key advantages of AI is its ability to analyse large amounts of data quickly. ASIC plans to upgrade its licensing and registration systems using AI to make decisions more efficiently. This should simplify processes while ensuring only qualified individuals receive licences. In addition, AI-powered tools will help ASIC spot trends and risks faster, strengthening their ability to oversee the industry.
ASIC is also looking into real-time monitoring technology, which would reduce the sharing of sensitive data and improve accuracy. These upgrades aim to speed up oversight and minimise regulatory delays.
Strengthening Cyber Resilience Across the Financial Sector
Cyber-attacks are happening more often and becoming more sophisticated, with one attack reported every six minutes in Australia. Because of this, cyber resilience is a top priority for ASIC. Their long-term cyber resilience program is designed to ensure that financial institutions have strong systems in place to prevent, detect, and respond to cyber threats—something we as licensees take seriously too.
Managing the Risks of AI Misuse
While AI offers many benefits, it also brings risks, especially if misused. ASIC is aware of the dangers of tech-enabled scams and AI misuse in the financial sector. They plan to closely monitor how AI is used by businesses, especially when it comes to handling consumer data, to ensure responsible use.
Conclusion
ASIC’s 2024-25 Corporate Plan clearly shows a shift towards using technology to improve regulatory oversight and resilience. For financial advisers, this means more scrutiny through AI-driven monitoring, the need for stronger cybersecurity to protect client data, and ensuring ethical use of AI. Staying ahead of these changes will help advisers remain compliant and enhance their reputation in an increasingly tech-driven financial world.
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