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AI: A disruptive force for good and evil – a financial planning perspective.

June 19, 2023

AI: A disruptive force for good and evil – a financial planning perspective.

The recent developments in artificial intelligence (AI) are being considered revolutionary. The potential to maximize our efficiencies and productiveness in all areas of our lives may be exciting, but equally concerning are the dangers of such a powerful force in the hands of the wrong people. Like other revolutionary developments, such as the creation of the Atomic bomb, Internet, and genetic engineering, the revolution of AI may eventually have a far-reaching and consequential impact on our every-day lives.

In its basic form, AI is the ability for a computer to perform tasks associated with learning, reasoning, problem solving, perception and use of language. AI applies cognitive intelligence to a problem compared to an algorithm, which is only a set of instructions that perform a particular task.

If you have been keeping up with the news this year, you’ve probably heard of ChatGPT, an AI application released by OpenAI in association with Microsoft. GPT stands for “generative pre-trained transformer,” a technology that can create or “generate” new text, visual images and audio. Basically, it is a program that can process our natural human language and generate responses. The game-changing aspect of ChatGPT is the responses it can provide. For example, you can ask it to write a college-level report on the American Civil War in the style of Shakespeare and the results can be mind-blowing, especially because how quickly it is produced!

In business, ChatGPT is already being used to write marketing materials such as blogs, newsletters, and social media posts. New uses for the financial services industry are quickly being developed which may become valuable tools to automate labor intensive processes. The goal is to augment the productiveness of the financial advisor and leverage their expertise for the ultimate benefit of the client. Maybe down the road, financial advisors will have “virtual” assistants, but AI will require human oversight because it is not good at what humans are good at. AI has no creativity, imagination, intuition or emotional intelligence. AI can do specific tasks but not at the same level of adaptability and flexibility that humans can.

Unfortunately, as often goes with all good things, there can also be a dark side, sort of like a Ying and Yang of Good and Evil. First, although AI has improved in producing creative and sometimes humorous responses, users need to be aware that the responses often contain information mishaps, or even “hallucinations,” which can include irrelevant, nonsensical, or factually incorrect answers. In fact, experts have warned that AI tools have the potential to spread inaccurate information.

Also on the dark side is the increase of AI related scams. The traditional ways of scamming will be exponentially worse because of the power of AI and how easy it can be to implement on a massive scale. Unfortunately, scammers are using these emerging technologies to their advantage to trick unsuspecting victims. Known as voice spoofing, cybercriminals now need as little as three seconds of someone's voice to successfully clone it and make it usable in a scam call. Scammers are now using AI programs that can mimic the voice of a loved one in order to request money using fake and urgent situations, or even government agents from the IRS.

Other scams include prompt injection attacks and phishing 2.0. These are bots that hide in the background and come alive when certain prompts take place, such as visiting a particular website or clicking an email link, at which time it unleashes actions like impersonating talking to a Microsoft employee (via video chat) or retrieval of personal information.

Being vigilant is a necessary starting point in reducing your chances of becoming a victim – the following are some suggestions to help protect yourself:

  1. Don’t click on links, pay close attention to emails
  2. Always verify a caller, especially if answering a call
  3. Develop family code words, or secret passwords, that only your family knows to identify yourself
  4. Use two-factor authentication, including SMS notification from a bank
  5. Always look for HTTPS on the address bar if entering personal info on a website
  6. Take advantage of identity theft and malware device protection programs
  7. Set up a VPN (virtual private network) at your home

Your cyber security, and of course overall security, is paramount to our firm. At CAS we have numerous procedures in place to protect your personal information. For example, all trade and money movement requests must be confirmed over the phone using only a phone number you have on file. We also have authentication procedures in place when CAS staff communicates with clients, and all emails are encrypted. We will continue to stay abreast of this rapidly changing technology, and keep you informed. If you have any questions or concerns, please reach out to your advisor.

Full Disclosure: This article is about AI, but was written by a human.