Sebi flags AI risks, plans advisory on cyber resilience and market safeguards

The Securities and Exchange Board of India (Sebi) is set to issue an advisory flagging risks from next-generation artificial intelligence (AI) models and AI-led vulnerability detection tools, amid rapid advances that could disrupt the financial services ecosystem.

Sebi chairman Tuhin Kanta Pandey indicated that increasingly powerful AI systems—including models such as Claude Mythos — can both strengthen and undermine market resilience. “These tools can identify weaknesses faster, but can also exploit vulnerabilities at speed and scale. In an interconnected securities market, a single weak link can create wider risks,” he said at the IMC Capital Markets conference in Mumbai on Monday.