UK Study Warns of AI-Generated Disinformation Fueling Bank Runs

A recent study conducted in the United Kingdom has raised concerns over the increasing threat of artificial intelligence (AI)-generated disinformation triggering bank runs.

The research, carried out by Say No to Disinfo and Fenimore Harper, reveals that AI-driven fake news can create panic among bank customers, leading to mass withdrawals that could destabilise financial institutions.

According to the study, generative AI can be used to craft highly convincing but false narratives about the security of customer deposits. When such misinformation is amplified through social media platforms and paid advertisements, it has the potential to spread rapidly, influencing public perception and financial behaviour.

Experiments conducted as part of the study showed that exposure to AI-generated fake news significantly increased the likelihood of UK bank customers considering withdrawing their funds. Alarmingly, researchers estimated that for every £10 spent on promoting such disinformation, up to £1 million in customer deposits could be put at risk.

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To counter this growing threat, financial institutions are being urged to strengthen their media monitoring and fraud detection systems. The study recommends integrating real-time monitoring of misinformation with existing withdrawal tracking mechanisms to quickly identify and respond to emerging threats.

While some banks have already begun implementing AI-driven threat detection systems, experts warn that a more coordinated and proactive approach is needed across the banking sector. Without adequate safeguards, AI-generated misinformation could exploit public fears, leading to widespread financial instability.

The findings underscore the dual-edged nature of AI technology, which, while driving innovation across industries, also presents new avenues for malicious activities that can undermine economic security. As AI capabilities continue to evolve, regulatory bodies and financial institutions must collaborate to address emerging risks and safeguard public confidence in the banking system.