UK regulator seeks broader powers to oversee AI in finance

The UK's financial regulator has called for expanded powers to oversee the use of artificial intelligence in consumer finance, warning that rapid adoption is outpacing existing rules and creating significant new risks. The Financial Conduct Authority published a landmark review on Monday, July 6, 2026, concluding that AI will transform how firms operate, how consumers make decisions, and how markets function by the end of the decade.

Led by FCA Executive Director Sheldon Mills, the review found that consumer adoption has accelerated beyond expectations. Research indicates around 11 million UK adults are likely to use AI that can act autonomously within preset goals, and more than a quarter of consumers already trust general-purpose tools like ChatGPT, Claude, and Gemini for financial advice. A significant concern is that many users are unaware these tools operate outside the existing regulatory perimeter, meaning consumers have no formal recourse if they receive poor guidance.

Mills described the situation as an arms race, stating that regulators must embrace AI themselves to monitor the sector effectively. The report recommends the FCA decide within the next three to six months...