Retail Banking Institute | Fake ads and bank runs

Fake ads and bank runs

One definition of a bank run is that people run to the bank to get their money: the original bank run was Wall Street in 1929.When news spread online in 2023 about problems at Silicon Valley Bank, $42 billion was moved in 24 hours. A new study find that a ten-dollar fake advert could cause a million-dollar bank run. “Fake news generated by artificial intelligence and spread on social media is heightening the risks of bank runs, according to a new British study that says lenders must improve monitoring to detect when disinformation risks impacting customer behaviour,” Reuters reports. “Generative AI can be used to create fake news stories saying that customer money is not safe, or memes appearing to joke about security issues, which can be spread on social media using paid adverts, said the study, published by UK research company Say No to Disinfo and communications firm Fenimore Harper.” The Silicon Valley Bank crash was accelerated by Twitter and WhatsApp groups. Revolut’s Head of Financial Crime Woody Malouf said the industry considered such as event possibly but unlikely, but said the bank did real-time checks across the broader ecosystem including on social media. Social media businesses have recently promised to reduce fact checking and let people figure things out for themselves.