Technology: SEC scrutinizes what companies disclose about artificial intelligence amid bubble fears

Washington — The U.S. Securities and Exchange Commission (SEC) is examining what artificial intelligence companies disclose, at a time of investor concern over the sector's accelerated spending and possible circular deals that may have fueled a bubble.

David Woodcock, the agency's enforcement director since May 2026, told Reuters that the priority is to verify that issuers accurately communicate relevant risks, without turning oversight into an obstacle to technological innovation. His central message, according to the interview, is that people must make accurate disclosures about material information so investors know what they are getting into.

The review comes amid a drop in shares of major technology companies and questions about the level of spending on artificial intelligence. On October 30, Bloomberg reported that the sector's slide was intensifying on doubts about that spending, while several companies have reported burning cash to finance their AI expansion.

The SEC did not announce in the interview a specific investigation against any particular company or a conclusion that a bubble exists. Woodcock made clear, however, that the agency will resort to enforcement if it finds that issuers do not provide material information accurately.

The official also warned that artificial intelligence has made it easier and cheaper to produce scams at scale, raising the risk for a growing number of people, and asked brokers and other firms to have processes in place to protect retail investors.

Photo: DiarioBitcoin

Source: DiarioBitcoin