The UK's financial regulator says firms' incident reporting must cover significant AI failures and near-misses as increasingly autonomous systems raise new risks.
Speaking at Bloomberg's UK Policy Series on Monday, Financial Conduct Authority chief data, information and intelligence officer Jessica Rusu said the regulator wants Britain to lead safe AI adoption in financial services. Greater autonomy, however, requires clear accountability.
"Poorly governed AI can create consumer harm, cyber vulnerabilities, and operational failures, potentially at much greater speed and scale," she said.
"Our rules already require firms to report major incidents, and that must extend to significant AI failures and near-misses. As the AI Minister has recognized, near-miss reporting for agentic AI is becoming a national security priority. It is a regulatory priority too."
The UK punches above its weight in financial services. The sector contributed £223.6 billion to the UK economy in 2025, or 8 percent of national output. That share was the fourth highest among OECD countries.
Last week, UK artificial intelligence minister Kanishka Narayan said the government plans to work with Parliament and technical experts to assess how it could strengthen the regime to better protect Britain from AI-driven cyber threats and loss-of-control risks.
"That includes identifying and reporting on serious incidents and near misses, including reducing AI-driven risk across essential services, and ensuring serious AI incidents can be properly reviewed," he said.
Steven Adler, co-founder and chief scientist of independent nonprofit Guidelight AI Standards, also told MPs last week that AI oversight could learn from aviation, where reporting of near-misses is mandatory in most jurisdictions.
"The way this works in aviation is that you not only want to learn about the serious crashes where someone has in fact died; you want to learn about the near-misses, because you can learn from those and help avoid them in the future," he said.
However, the government has yet to commit to adding AI-specific measures to the Cyber Security and Resilience (Network and Information Systems) Bill. Alexandra Jones, Director General for Growth, Science and International at the Department for Science, Innovation and Technology, told MPs last week that amendments remain under consideration.
In January, the House of Commons Treasury Committee called on financial regulators to conduct stress tests to ensure businesses are ready for AI-driven market shocks. The committee said there should be clear lines of accountability when AI systems produce harmful or unfair outcomes. ®
