U.S., UK and EU Regulators Advance AI Risk Management and Live Testing in Financial Services

Banks and fintech companies already use AI for credit underwriting, pricing, fraud detection and anti-money laundering. But model bias, drift, black-box decision-making and concentration among third-party vendors could harm consumers and amplify financial-stability risks. The U.S. Treasury, the UK's Financial Conduct Authority and the European Union are therefore moving beyond broad principles toward audit-ready controls, regulatory sandboxes and live testing.

On February 19, 2026, the U.S. Treasury released an AI risk management framework for financial services and an AI lexicon. Developed with input from more than 100 financial institutions and government agencies, the framework sets out 230 control objectives across governance, mapping, measurement and management. It creates no new legal obligations, and no grant amount was announced. The FCA's second AI Live Testing cohort is scheduled to begin in late April, while the EU classifies credit scoring as a high-risk use under the AI Act.