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In this edition we round up FinTech-related financial services regulatory developments for the week ending 20 February 2026.
ICYMI
- New York court finds client chats with generative AI tool Claude are not privileged
- Civil Justice Council publishes consultation on use of AI for preparing court documents
UK
HM Treasury responds to questions on AI among others
The following responses from HM Treasury to questions on AI, among others, raised by members of the House of Lords and House of Commons have been published.
Questions asked on reasonable adoption of AI and assessment on impact of AI use included:
- what steps HM Government is taking to support the responsible adoption of AI by UK financial services firms; and
- what assessment has been made of the impact of AI use by those firms on productivity, service delivery and competitiveness.
HM Treasury's response highlighted ambitions for the UK to lead on technological advancement in the financial services sector and also noted the important role of the recently appointed Financial Services AI Champions. The Champions will help firms seize the opportunities of AI while protecting consumers and financial stability.
Questions asked on automation and AI-driven financial workflows, and digital economy included:
- what assessment has been made of the impact of increased automation and AI-driven financial workflows on the fintech sector; and
- what policy measures are being considered to support the UK's competitiveness in the digital economy.
HM Treasury's response highlighted the UK's Financial Services Strategy which sets out a comprehensive package of reforms to maintain the UK's global leadership in fintech, a sector which attracted $3.6 billion of investment in 2025.
On policy measures in relation to the digital economy, HM Treasury responded that the 2025 AI Opportunities Action Plan sets out its strategy. In January, the Government announced that 75% of the recommendations committed to have been actioned, including developing AI talent through the £187 million tech first package and the designation of five AI Growth Zones across the UK.
Questions asked on external industry expertise and safe responsible AI included:
- what assessment has been made of the use of external industry expertise to support innovation in UK financial services through the appointment of AI Champions in the Treasury; and
- how this fits within the policy on the safe and responsible use of AI.
HM Treasury responded that the appointment of Financial Services AI Champions will focus effort on helping firms. The AI Champions will engage with industry experts, the regulators and other stakeholders to provide ministers and officials with recommendations. [18 Feb 2026] #AI
Europe
ESMA: AI adoption and trends in the securities market
ESMA has published analysis of recent trends related to the use of AI in securities markets. AI adoption in the EU financial sector remains partial and uneven, with smaller firms lagging behind larger ones. However, firms' sentiment on AI appears to be trending upward across the board, with 70% of firms anticipating an increase in AI-related investment between 2025 and 2027.
Current use cases focus on low-autonomy, general-purpose back-office tools expected to enhance operational efficiency, although firms are experimenting with a variety of more customised, sector-specific applications. Regarding the challenges associated with AI deployment, data- and model-related vulnerabilities introduced or amplified by AI systems are among firms' top concerns, with cybersecurity and third-party dependencies also frequently highlighted. [20 Feb 2026] #AI
ECB and ONCE Foundation to collaborate on digital euro accessibility
The ECB has announced that it signed a collaboration agreement with the ONCE Foundation for Cooperation and Social Inclusion of People with Disabilities to promote, develop and ensure the digital euro app is easily accessible for everyone, including people with disabilities or limited digital skills and older adults. [18 Feb 2026] #DigitalEuro
US
U.S. Treasury announces private initiative to strengthen cybersecurity and risk management for AI in financial services
The U.S. Department of the Treasury has announced that the work of a major public-private initiative to strengthen cybersecurity and risk management for AI in the financial services sector has concluded. During February, the Treasury will release a series of six resources developed by industry and federal and state regulatory partners which will enable secure and resilient AI across the U.S. financial system.
The resources will focus on practical implementation rather than setting prescriptive requirements. They cover governance, data practices, transparency, fraud and digital identity.
The initiative is in support of the President's AI Action Plan. [18 Feb 2026] #AI
CFTC files amicus brief confirming exclusive jurisdiction over prediction markets
The Commodity Futures Trading Commission (CFTC) has announced its filing of an amicus brief in the U.S. Circuit Court of Appeals for the Ninth Circuit. The amicus brief was filed in North American Derivatives Exchange, Inc. et al v. The State of Nevada on relation of the Nevada Gaming Control Board et al. It outlines the legal history of the CFTC's exclusive jurisdiction over all commodity derivatives markets, including prediction markets.
CFTC Chair Michael Selig has also penned an op-ed on states' encroachment on prediction markets. [17 Feb 2026] #Crypto
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