FCA, BoE and HMT issue joint statement warning that Frontier AI models are intensifying cyber threats, fraud, and operational resilience risks, urging stronger governance and cyber defences

The authorities warn that while AI can improve efficiency, detection capabilities, and financial innovation, it also introduces new systemic risks, particularly where firms rely heavily on third-party AI providers, interconnected digital infrastructure, and automated decision-making systems. The statement emphasises the need for FIs to strengthen governance, AI risk oversight, cyber resilience testing, supply chain security, and operational safeguards to ensure that the adoption of advanced AI technologies does not undermine financial stability…