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Artificial intelligence

Dubai Financial Services Authority Publishes Report on Cyber and Artificial Intelligence Risk in Financial Services

Strategic Insights

— 1 min read

The Dubai Financial Services Authority (DFSA) has published a report titled 'Cyber and Artificial Intelligence Risk in Financial Services: Strengthening Oversight Through International Dialogue', providing insights into the evolving digital risk landscape and exploring the impact of emerging technologies on regulatory priorities. The report follows a regulatory college held in May 2025, where 70 senior representatives from 18 financial authorities discussed the increasing complexity of cyber risks, AI adoption, and the implications of quantum computing. The report explores supervisory perspectives on cybersecurity, quantum computing, and AI emerging risks, highlighting the importance of enhancing explainability and interpretability methods, robust third-party risk oversight, and responsible governance.

Key Takeaways:

  • The report highlights the increasing frequency and sophistication of cyberattacks, including threats arising from emerging technologies and supply chain dependencies.
  • The potential for quantum computing to render current encryption in critical communication systems obsolete requires early coordinated planning around post-quantum cryptography.
  • The growing adoption of AI across financial services emphasizes the need for enhancing explainability and interpretability methods, robust third-party risk oversight, and responsible governance.
  • Justin Baldacchino, Managing Director of Supervision at DFSA, emphasized that digital risks are converging and regulatory approaches are evolving.
  • The report reflects a supervisory consensus on the importance of international dialogue in building mutual understanding of digital risks and adapting oversight practices.
  • Herman Schueller, Director of Innovation and Technology Risk Supervision at DFSA, highlighted the value of open, cross-border dialogue in addressing regulatory, technical, and operational dimensions of digital risks.
  • The report explores supervisory perspectives on three interconnected areas: cybersecurity threat landscape, quantum computing, and AI emerging risks.

Statistics:

  • 70 senior representatives from 18 financial authorities participated in the DFSA's inaugural Cyber and AI Risk Regulatory College.
  • 18 financial authorities were in attendance at the regulatory college, representing the Middle East, North America, Europe, Africa, and Asia.
  • The report emphasizes the importance of coordinated planning around post-quantum cryptography, as quantum computing poses a significant threat to current encryption methods.
  • AI adoption across financial services highlights the need for enhancing explainability and interpretability methods, robust third-party risk oversight, and responsible governance.

Sources:

  • "Cyber and Artificial Intelligence Risk in Financial Services: Strengthening Oversight Through International Dialogue" report (publication date not specified)
  • "Digital Regulation: The Role of the Dubai Financial Services Authority" (no date specified)

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