Bank of England Governor Urges To Use AI to Spot “Smoking Gun”

Bank of England Governor Andrew Bailey said regulators should adopt artificial intelligence to more effectively analyze the vast volumes of data collected from financial firms, thereby helping them identify potential risks. Speaking at a London School of Economics event, Bailey emphasized that AI and data science could enable watchdogs to determine the “smoking gun” early, thereby preventing missed warning signs that later emerge as failures. He warned that failing to use data effectively leaves regulators exposed to criticism when overlooked evidence surfaces. Bailey also reiterated his opposition to loosening financial regulation, cautioning against a return to risky practices that could threaten the economy. His remarks followed earlier clashes with Finance Minister Rachel Reeves, who described regulation as a “boot on the neck” of business.

Reuters, William Schomberg & Muvija M – Bank of England’s Bailey says AI can help regulators to find the ‘smoking gun’ – 22nd September 2025.