AI seen as new risk as firms lag on surveillance plans

A new survey of senior compliance decision-makers found that most financial firms expect artificial intelligence to create new compliance problems within a year. Yet a sizeable minority still lack a formal plan for using AI in trade surveillance.

Research by compliance technology provider eflow found that 69% of firms believe accelerated AI adoption will drive compliance issues in the next 12 months. It also found that 29% either have no formal AI strategy for trade surveillance or do not plan to use AI for that purpose.

The findings are from eflow's Global Trends in Market Abuse and Trade Surveillance Report 2026, based on a survey of 300 senior regulatory compliance decision-makers across the UK, the US, Europe and Asia-Pacific.

Beyond AI, respondents highlighted wider pressures on surveillance and compliance teams. Regulatory uncertainty was a major risk for 65% of firms, followed by geopolitical instability at 54%.

Slow deployment

Despite the focus on AI-related risk, adoption within surveillance functions remains limited. Only 16% reported fully deploying AI in trade surveillance operations.

Another 31% said they were rolling out AI in specific areas, while 24% plan to deploy it within the next 12 to 24 months.

The results suggest a gap between expectations and current operating models. Many compliance teams now treat AI both as a risk factor and as a tool for detection and monitoring.

Strategy and governance also appear to be lagging concerns. The 29% figure includes firms that have not formalised how AI fits into trade surveillance, as well as those that have decided against using it.

US versus UK

Regional results show differing levels of regulatory anxiety. Three-quarters of US firms cited regulatory uncertainty as a major risk, compared with 63% in the UK.

Eflow linked sentiment in the US to a shifting regulatory climate. The report described a "regulatory reset" under the Trump administration and said it has heightened compliance anxiety among US firms.

Globally, 53% cited keeping pace with regulatory change as a leading market abuse and surveillance concern, pointing to the burden of frequent rule updates, shifting supervisory focus, and the need to evidence controls.

US respondents were also more likely than UK peers to flag crypto markets as a source of future compliance risk. The report did not quantify the difference, but said regulatory clarity remains contested across jurisdictions.

Systems integration

The survey highlighted ongoing challenges in joining up different surveillance disciplines. Integrating trade surveillance with electronic communications surveillance was a significant issue for 58% of US organisations, compared with 40% elsewhere.

The gap suggests US firms are either more likely to face fragmentation between systems or more likely to prioritise integration work.

Market abuse controls often span order and trade data, voice and messaging content, and behavioural patterns across desks and asset classes. Firms running multiple systems can struggle to maintain consistent alerting, case management processes, and audit trails.

While the report focuses on trade surveillance, it sets the topic in a broader compliance context, grouping AI, regulatory change, geopolitical shocks, and complex market structure as linked drivers of risk and operational demand.

Regulator engagement

The research suggests compliance leaders want more direct engagement with supervisors. Half of firms (50%) said closer collaboration between regulators and compliance teams would best support the goal of balancing market integrity and growth.

Another 47% want greater transparency around regulatory expectations and enforcement actions. The report frames these preferences as a response to uncertainty, particularly as new technologies and market practices raise questions about supervisory standards.

eflow's Chief Executive said the results show firms understand the direction of travel but are still building internal readiness.

"AI is now reshaping both how markets operate and how misconduct can emerge. Our 2026 findings show that firms clearly recognise this shift, but many are still building the foundations needed to deploy AI responsibly and effectively within their trade surveillance operations. At the same time, regulatory uncertainty and ongoing market volatility continue to place compliance teams under sustained pressure. Stronger collaboration between firms and regulators will be essential to ensure innovation can progress without undermining market integrity," said Ben Parker, Co-founder and Chief Executive Officer of eflow.

eflow, founded in 2004, sells regulatory compliance technology to financial firms. It says it serves more than 140 clients across five continents, including buy-side and sell-side firms.

The results point to continued investment in surveillance technology and operating processes, as firms assess AI tools while responding to shifting rules and supervisory priorities across major markets.