AI Tops RIA Compliance Concerns
Artificial intelligence and predictive analytics have overtaken anti-money laundering and cybersecurity as the top compliance concern for registered investment advisers, according to the 2025 Investment Management Compliance Testing Survey conducted in May by the Investment Adviser Association, ACA Group, and Yuter Compliance. Fifty-seven percent of compliance officers named AI as their number one “hot topic,” compared with 41 percent citing AML and 38 percent citing cybersecurity. The survey, which drew responses from hundreds of advisory firms of all sizes, shows that adoption of AI is real but uneven. About 40 percent of firms report using AI for internal purposes, while only 5 percent have extended it into client interactions. Many are still building guardrails as regulators intensify scrutiny of the technology.
GiGCXOs says the firms that succeed will be those that build governance structures examiners can easily understand. That begins with an AI use registry covering systems, prompts, data sources, outputs, and ownership, combined with risk-based rules for what is allowed, limited, or prohibited in client-facing versus internal applications. Testing and validation playbooks must account for accuracy, bias, hallucinations, and data leakage, with clear records of model updates and overrides. Regulators are examining not just whether firms use AI but how they use it, making visible governance table stakes.
Marketing compliance is another area where risks escalate with AI. Pre-review workflows must be able to detect promissory language, performance or benchmark issues, and missing risk prominence before publication. Firms should maintain disclosure libraries and lists of prohibited terms while requiring attestations for advisor-authored posts, emails, presentations, and videos. With the SEC’s Marketing Rule still a top exam priority, the volume and speed of AI-generated content means errors can spread faster than ever.
Electronic communications remain a parallel challenge. Advisory firms must capture email, text, chat, and social media messages across approved channels, while also monitoring for off-channel activity and escalating violations quickly. AI-assisted surveillance should be trained to detect spoofing, pretexting, unapproved recommendations, and privacy breaches, with fast eDiscovery and export functions ready for exams or complaints.
Anti-money laundering, cybersecurity, and vendor diligence must also expand to account for AI. Risk assessments should reflect threats like deepfakes, account takeovers, and data exfiltration, and firms must test their controls against these scenarios. Vendor due diligence needs AI-specific questions about model origin, training data, privacy protections, key management, and incident history. Staff training should include prompt hygiene, handling of sensitive data, and recognition of red flags.
The cornerstone of any program is evidence. Regulators will expect a single, exam-ready evidence pack containing AI policies, registries, approvals, test results, content reviews, surveillance logs, exceptions, and reports to boards or chief compliance officers. Metrics showing usage, overrides, exceptions, and remediation timelines are critical to proving the program works.
GiGCXOs has already deployed Hadrius as the core application within AICompliance360, a system in production at numerous broker-dealers and RIAs. The platform enables firms to stand up an AI-ready compliance stack immediately, with pre-review workflows that screen for unbalanced claims, performance references, testimonials, and risk prominence, as well as centralized approvals, audit trails, attestations, and exportable exam packets. It provides capture and review of advisor content across channels, with exceptions routed into remediation workflows, and integrates governance policies, role-based permissions, and reporting dashboards designed for examiners.
Deliverables include a blueprint mapping AI policies, taxonomies, intake and approval gates, and a live AI registry to firm applications and data; marketing guardrails with AI-assisted pre-screening; upgraded communications oversight with unified capture and surveillance rules; cyber and AML programs updated for deepfake and impersonation scenarios; and consolidated evidence sets aligned to SEC and FINRA expectations.
The takeaway from the survey is that firms are leaning into AI, but governance, testing, and documentation will determine whether those innovations hold up under regulatory exams. With AI now the leading compliance concern, the firms that will come out ahead are those that can demonstrate precisely how their controls work and back it up with evidence. GiGCXOs argues that AICompliance360, powered by Hadrius, provides that production-ready system today. Contact us today.
Source: Investment News June 22, 2025 