Modern Intelligence, Measured Risk: Navigating AI with Regulatory Clarity

Key Takeaways from Align's AI and Financial Services Panel Discussion

Our recent panel discussion brought together four industry veterans to tackle the question everyone's asking: Are financial firms ready for AI regulation?

Short answer: No. But that's not necessarily bad news.

The Panelists

Vinod Paul – President of Managed Services, Align
Supporting 350+ clients globally, specializing in RIAs and hedge funds

Chris Turek – Former CIO, Evercore
Nearly 20 years as a practitioner in investment banking and advisory

Eldon Sprickerhoff – Strategic Advisor and Growth Architect, Caldon Ventures
Co-founder of eSentire

James Mignacca – Founder & CEO, Cavelo
Building AI readiness and risk management solutions

Larry Meador – Channel Chief, Cavelo (Moderator)

What We Discovered

The Current State: "It's the Wild West"

• The blind spot: Firms think they're not using AI, but employees are already feeding confidential data into ChatGPT
• Regulatory gap: Even regulators aren't sure what questions to ask yet (remember when SEC asked for "all email on a disc" in 2005?)
• Investor pressure: Due diligence teams are ahead of regulators, already asking sophisticated AI policy questions

"Even though the regulators are not caught up, I will tell you the operational due diligence side of things, the investors are getting more sophisticated, and they do understand the risks as well as the nuances of AI."

- Vinod Paul, President of Align Managed Services

The Real Challenges

1. People remain the weakest link: Employees default to ChatGPT for everything
2. Shadow AI is inevitable: Block it, and employees will find workarounds
3. Data is the bottleneck: Not the AI models themselves

"You could build an AI tool where you'd say, Hey, let's dump all the company's data in it. That'd be great. Except the only person who could use it would be the CEO because he's the only person who could see every piece of data in the firm."

– Chris Turek, Former CIO of Evercore

The Opportunity

• First-mover advantage for firms that get governance right
• AI as defense: Using AI tools to protect against AI-powered attacks
• Efficiency gains across all roles could transform entire businesses
• Job enhancement, not replacement: The people who embrace AI won't get fired; the people who don't use AI will be replaced by people who do
  
  

"At the end of the day, are you really trying to replace employees? Chances are you're not, you probably want to enhance them, have them work on more high touch stuff."

- James Mignacca, CEO of Cavelo

What You Should Do Next

1. Audit your AI usage now: You're probably using more than you think
2. Create cross-functional governance (including HR): Don't leave this to IT alone
3. Focus on data preparation: This is your real bottleneck
4. Prepare for investor questions: They're already asking about AI policies
   
   

Access the Full Panel Discussion

The full panel discussion covers specific governance frameworks, real-world implementation strategies, and detailed risk scenarios. 

Click here to watch the full panel discussion

This panel was part of Align's ongoing commitment to helping financial services firms navigate emerging technology challenges. For more insights on AI governance and cybersecurity, contact our team: https://www.align.com/managed-services