Safeguarding against AI exploitation in e-commerce investment management

Vitalii Volynets; Hanna Ilchenko; Mykhailo Akimov; Iryna Pokhylenko; Oleh Dobrodzii

doi:10.31893/multirev.2024spe028

Keywords:

risks

legal aspects

ethical norms

Artificial Intelligence

medical insurance

Abstract

Artificial intelligence (AI) is increasingly vital in e-commerce, especially investment management. AI can enhance decision-making processes, risk analysis, and trend forecasting. However, legal aspects must be considered to prevent abuses and ensure the legality and ethics of AI use in investment management. Data collection and analysis are crucial stages in investment management. Compliance with data protection legislation is essential when using AI for automated decision-making in investment processes. Ethical considerations must be considered as these decisions can impact individuals' financial interests. Therefore, it is crucial that such systems are transparent and adhere to ethical standards. Determining who is responsible for the outcomes of AI decisions made in investment management is also essential. Software developers, system operators, and financial advisors may use AI to support their decisions. However, using AI can make them vulnerable to cyberattacks and affect the security of financial operations. Therefore, it is crucial to develop systems with high data protection levels and check them for vulnerabilities. Investment management in e-commerce may have an international dimension, which raises questions about compliance with international standards and regulatory requirements in AI. Artificial intelligence in investment management in e-commerce offers numerous opportunities to improve process efficiency and accuracy. However, it is crucial to ensure that such applications comply with legal norms, ethical principles, and security requirements. Only this approach will maximise AI's benefits in investment management while ensuring the legality and ethics of technology use.
References
1. Aggarwal, P., & Mazumdar, T. (2008). Decision delegation: A conceptualisation and empirical investigation. Psychology and Marketing, 25(1), 71–93. https://doi.org/10.1002/mar.20201
2. Akimov, O., Karpa, M., Parkhomenko-Kutsevil, O., Kupriichuk, V., & Omarov, A. (2021). Entrepreneurship education of the formation of the e-commerce managers professional qualities. International Journal of Entrepreneurship, 25(7).
3. Bawack, R.E., Wamba, S.F., Carillo, K.D.A. et al. (2022). Artificial intelligence in E-Commerce: a bibliometric study and literature review. Electron Markets, 32, 297–338. https://doi.org/10.1007/s12525-022-00537-z
4. Beccalli, E., Elliot, V., & Virili, F. (2020). Artificial Intelligence and Ethics in Portfolio Management. Springer, Cham. https://doi.org/10.1007/978-3-030-47355-6_2
5. Chesterman, S. (2020). Artificial intelligence and the limits of legal personality. International and Comparative Law Quarterly, 69(4), 819-844. https://doi.org/10.1017/S0020589320000366
6. Chui, M. (2021). The state of Al in 2021. McKinsey, Dec 8, 2021 (for FY 2020). Available at: https://www.mckinsey.com/capabilities/quantumblack/our-insights/global-survey-the-state-of-ai-in-2021 Accessed: April 5, 2024.
7. Consultancy.eu (2023). European AI Act: Implications for the financial services industry. 19 Oct., 2023. https://www.consultancy.eu/news/9392/european-ai-act-implications-for-the-financial-services-industry. Accessed on April 5, 2024.
8. Davis, M., Kumiega, A., & Van Vliet, B. (2012). Ethics, Finance, and Automation: A Preliminary Survey of Problems in High Frequency Trading (September 19, 2012). Science and Engineering Ethics, 19(3), 851-874. http://dx.doi.org/10.2139/ssrn.1993211
9. European ethical Charter on the use of Artificial Intelligence in judicial systems and their environment (2019). Council of Europe. https://rm.coe.int/ethical-charter-en-for-publication-4-december-2018/16808f699c. Accessed: April 5, 2024.
10. Grant, D. (2023). Artists, writers, performers and their advocates call on US Congress to ban companies from copyrighting AI-generated art. The Art Newspaper. 27 September 2023. https://www.theartnewspaper.com/2023/09/27/artificial-intelligence-day-of-action-us-congress-copyright-regulation. Accessed on April 5, 2024.
11. Hill, R. K. (2015). What an algorithm is. Philosophy and Technology, 29(1), 35–59. https://doi.org/10.1007/s13347-014-0184-5
12. Hurlburt, G. F., Miller, K. W., & Voas, J. M. (2009). An ethical analysis of automation, risk, and the financial crises of 2008. IT Professional, 11(1), 14–19. https://doi.org/10.1109/MITP.2009.2
13. Hutsaliuk, O., Koval, V., Tsimoshynska, O., Koval, M., Skyba, H. Risk (2020) Management of Forming Enterprises Integration Corporate Strategy. TEM Journal, 9(4), 1514-1523.
14. Jiang, Y., Havrysh, V., Klymchuk, O., (...), Balezentis, T., Streimikiene, D. (2019). Utilization of Crop Residue for Power Generation: The Case of Ukraine. Sustainability (Switzerland), 11(24), 7004.
15. Khatniuk, N., Shestakovska, T., Rovnyi, V., Pobiianska, N., Surzhyk, Y. (2023). Legal principles and features of artificial intelligence use in the provision of legal services. Journal of Law and Sustainable Development, 11(5).
16. Kostiukevych, R., Mishchuk, H., Zhidebekkyzy, A., Nakonieczny, J., Akimov, O. (2020). The impact of european integration processes on the investment potential and institutional maturity of rural communities. Economics and Sociology, 13(3), 46-63.
17. Kussainov, K., Goncharuk, N., Prokopenko, L., Pershko, L., Vyshnivska, B., & Akimov, O. (2023). Anti-corruption management mechanisms and the construction of a security landscape in the financial sector of the EU economic system against the background of challenges to european integration: Implications for artificial intelligence technologies. Economic Affairs (New Delhi), 68(1), 509-521. https://doi.org/10.46852/0424-2513.1.2023.20
18. Mazzini, G., & Bagni, F. (2023). Considerations on the regulation of AI systems in the financial sector by the AI Act. Frontiers in Artificial Intelligence, 6. https://doi.org/10.3389/frai.2023.1277544
19. Monroe, D. (2018). AI, explain yourself. Communication of the ACM 61(11), 11-13. https://doi.org/10.1145/3276742
20. Muzychenko, T. O., Skorba, O. A., & Shevchuk, A. A. (2023). Artificial intelligence as a means of optimising business processes in e-commerce. Academic visions, (25). https://www.academy-vision.org/index.php/av/article/view/696. Accessed on April 5, 2024.
21. Ottaviani, M. (2000). The economics of advice. University College London, Mimeo. https://www.researchgate.net/publication/2400488_The_Economics_of_Advice. Accessed on April 5, 2024.
22. Potwora, M., Zakryzhevska, I., Mostova, A., Kyrkovskyi, V., Saienko, V. (2023). Marketing strategies in e-commerce: personalised content, recommendations, and increased customer trust. Financial and Credit Activity: Problems of Theory and Practice, 5(52), 562-573.
23. Sarker, I.H. (2022). AI-Based Modeling: Techniques, Applications and Research Issues Towards Automation, Intelligent and Smart Systems. SN computer science, 3(2). https://doi.org/10.1007/s42979-022-01043-x
24. Sikaria, V. (2024). Mordor Intelligence Research & Advisory. E-commerce Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029). https://www.mordorintelligence.com/industry-reports/global-ecommerce-market Accessed on April 5, 2024.
25. The Four Stages of AI Maturity: From Base Research to Successful Integration in Investments (2024). https://www.mdotm.ai/blog/the-four-stages-of-ai-maturity-from-base-research-to-successful-integration-in-investments Accessed on April 5, 2024.
26. The White House (2023). Remarks by President Biden on Artificial Intelligence. July 21, 2023. https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/07/21/remarks-by-president-biden-on-artificial-intelligence/ Accessed on April 5, 2024.
27. Towards Regulation of AI Systems. Global perspectives on the development of a legal framework on Artificial Intelligence (AI) systems based on the Council of Europe’s standards on human rights, democracy and the rule of law (2020). Council of Europe. https://rm.coe.int/prems-107320-gbr-2018-compli-cahai-couv-texte-a4-bat-web/1680a0c17a%203A52021PC0206 Accessed on April 5, 2024.
28. Veale, M. (2020). Critical Take on the Policy Recommendations of the EU High-Level Expert Group on Artificial Intelligence. European Journal of Risk Regulation, 11(1), 2020. https://doi.org/10.1017/err.2019.65
29. Wet, W. A. (2004). The role of asymmetric information on investments in emerging markets. Economic Modelling, 21(4), 621-630. https://doi.org/10.1016/j.econmod.2003.09.002
30. White Paper On Artificial Intelligence; A European approach to excellence and trust. (2020). European Commission. https://ec.europa.eu/info/sites/default/files/commission-white-paper-artificial-intelligence-feb2020_en.pdf Accessed on April 5, 2024.
31. Yu, X., Zhang, R., Zhang, B., Wang, H. (2021). Challenges of artificial intelligence to patent law and copyright law and countermeasures. The Future of Intellectual Property (Chapter 8), 150–168. Edward Elgar Publishing. https://doi.org/10.4337/9781800885349.00014

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

How to cite

Volynets, V., Ilchenko, H., Akimov, M., Pokhylenko, I., & Dobrodzii, O. (2024). Safeguarding against AI exploitation in e-commerce investment management. Multidisciplinary Reviews, 7, 2024spe028. https://doi.org/10.31893/multirev.2024spe028

[1] Aggarwal, P., & Mazumdar, T. (2008). Decision delegation: A conceptualisation and empirical investigation. Psychology and Marketing, 25(1), 71–93. https://doi.org/10.1002/mar.20201

[2] Akimov, O., Karpa, M., Parkhomenko-Kutsevil, O., Kupriichuk, V., & Omarov, A. (2021). Entrepreneurship education of the formation of the e-commerce managers professional qualities. International Journal of Entrepreneurship, 25(7).

[3] Bawack, R.E., Wamba, S.F., Carillo, K.D.A. et al. (2022). Artificial intelligence in E-Commerce: a bibliometric study and literature review. Electron Markets, 32, 297–338. https://doi.org/10.1007/s12525-022-00537-z

[4] Beccalli, E., Elliot, V., & Virili, F. (2020). Artificial Intelligence and Ethics in Portfolio Management. Springer, Cham. https://doi.org/10.1007/978-3-030-47355-6_2

[5] Chesterman, S. (2020). Artificial intelligence and the limits of legal personality. International and Comparative Law Quarterly, 69(4), 819-844. https://doi.org/10.1017/S0020589320000366

[6] Chui, M. (2021). The state of Al in 2021. McKinsey, Dec 8, 2021 (for FY 2020). Available at: https://www.mckinsey.com/capabilities/quantumblack/our-insights/global-survey-the-state-of-ai-in-2021 Accessed: April 5, 2024.

[7] Consultancy.eu (2023). European AI Act: Implications for the financial services industry. 19 Oct., 2023. https://www.consultancy.eu/news/9392/european-ai-act-implications-for-the-financial-services-industry. Accessed on April 5, 2024.

[8] Davis, M., Kumiega, A., & Van Vliet, B. (2012). Ethics, Finance, and Automation: A Preliminary Survey of Problems in High Frequency Trading (September 19, 2012). Science and Engineering Ethics, 19(3), 851-874. http://dx.doi.org/10.2139/ssrn.1993211

[9] European ethical Charter on the use of Artificial Intelligence in judicial systems and their environment (2019). Council of Europe. https://rm.coe.int/ethical-charter-en-for-publication-4-december-2018/16808f699c. Accessed: April 5, 2024.

[10] Grant, D. (2023). Artists, writers, performers and their advocates call on US Congress to ban companies from copyrighting AI-generated art. The Art Newspaper. 27 September 2023. https://www.theartnewspaper.com/2023/09/27/artificial-intelligence-day-of-action-us-congress-copyright-regulation. Accessed on April 5, 2024.

[11] Hill, R. K. (2015). What an algorithm is. Philosophy and Technology, 29(1), 35–59. https://doi.org/10.1007/s13347-014-0184-5

[12] Hurlburt, G. F., Miller, K. W., & Voas, J. M. (2009). An ethical analysis of automation, risk, and the financial crises of 2008. IT Professional, 11(1), 14–19. https://doi.org/10.1109/MITP.2009.2

[13] Hutsaliuk, O., Koval, V., Tsimoshynska, O., Koval, M., Skyba, H. Risk (2020) Management of Forming Enterprises Integration Corporate Strategy. TEM Journal, 9(4), 1514-1523.

[14] Jiang, Y., Havrysh, V., Klymchuk, O., (...), Balezentis, T., Streimikiene, D. (2019). Utilization of Crop Residue for Power Generation: The Case of Ukraine. Sustainability (Switzerland), 11(24), 7004.

[15] Khatniuk, N., Shestakovska, T., Rovnyi, V., Pobiianska, N., Surzhyk, Y. (2023). Legal principles and features of artificial intelligence use in the provision of legal services. Journal of Law and Sustainable Development, 11(5).

[16] Kostiukevych, R., Mishchuk, H., Zhidebekkyzy, A., Nakonieczny, J., Akimov, O. (2020). The impact of european integration processes on the investment potential and institutional maturity of rural communities. Economics and Sociology, 13(3), 46-63.

[17] Kussainov, K., Goncharuk, N., Prokopenko, L., Pershko, L., Vyshnivska, B., & Akimov, O. (2023). Anti-corruption management mechanisms and the construction of a security landscape in the financial sector of the EU economic system against the background of challenges to european integration: Implications for artificial intelligence technologies. Economic Affairs (New Delhi), 68(1), 509-521. https://doi.org/10.46852/0424-2513.1.2023.20

[18] Mazzini, G., & Bagni, F. (2023). Considerations on the regulation of AI systems in the financial sector by the AI Act. Frontiers in Artificial Intelligence, 6. https://doi.org/10.3389/frai.2023.1277544

[19] Monroe, D. (2018). AI, explain yourself. Communication of the ACM 61(11), 11-13. https://doi.org/10.1145/3276742

[20] Muzychenko, T. O., Skorba, O. A., & Shevchuk, A. A. (2023). Artificial intelligence as a means of optimising business processes in e-commerce. Academic visions, (25). https://www.academy-vision.org/index.php/av/article/view/696. Accessed on April 5, 2024.

[21] Ottaviani, M. (2000). The economics of advice. University College London, Mimeo. https://www.researchgate.net/publication/2400488_The_Economics_of_Advice. Accessed on April 5, 2024.

[22] Potwora, M., Zakryzhevska, I., Mostova, A., Kyrkovskyi, V., Saienko, V. (2023). Marketing strategies in e-commerce: personalised content, recommendations, and increased customer trust. Financial and Credit Activity: Problems of Theory and Practice, 5(52), 562-573.

[23] Sarker, I.H. (2022). AI-Based Modeling: Techniques, Applications and Research Issues Towards Automation, Intelligent and Smart Systems. SN computer science, 3(2). https://doi.org/10.1007/s42979-022-01043-x

[24] Sikaria, V. (2024). Mordor Intelligence Research & Advisory. E-commerce Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029). https://www.mordorintelligence.com/industry-reports/global-ecommerce-market Accessed on April 5, 2024.

[25] The Four Stages of AI Maturity: From Base Research to Successful Integration in Investments (2024). https://www.mdotm.ai/blog/the-four-stages-of-ai-maturity-from-base-research-to-successful-integration-in-investments Accessed on April 5, 2024.

[26] The White House (2023). Remarks by President Biden on Artificial Intelligence. July 21, 2023. https://www.whitehouse.gov/briefing-room/speeches-remarks/2023/07/21/remarks-by-president-biden-on-artificial-intelligence/ Accessed on April 5, 2024.

[27] Towards Regulation of AI Systems. Global perspectives on the development of a legal framework on Artificial Intelligence (AI) systems based on the Council of Europe’s standards on human rights, democracy and the rule of law (2020). Council of Europe. https://rm.coe.int/prems-107320-gbr-2018-compli-cahai-couv-texte-a4-bat-web/1680a0c17a%203A52021PC0206 Accessed on April 5, 2024.

[28] Veale, M. (2020). Critical Take on the Policy Recommendations of the EU High-Level Expert Group on Artificial Intelligence. European Journal of Risk Regulation, 11(1), 2020. https://doi.org/10.1017/err.2019.65

[29] Wet, W. A. (2004). The role of asymmetric information on investments in emerging markets. Economic Modelling, 21(4), 621-630. https://doi.org/10.1016/j.econmod.2003.09.002

[30] White Paper On Artificial Intelligence; A European approach to excellence and trust. (2020). European Commission. https://ec.europa.eu/info/sites/default/files/commission-white-paper-artificial-intelligence-feb2020_en.pdf Accessed on April 5, 2024.

[31] Yu, X., Zhang, R., Zhang, B., Wang, H. (2021). Challenges of artificial intelligence to patent law and copyright law and countermeasures. The Future of Intellectual Property (Chapter 8), 150–168. Edward Elgar Publishing. https://doi.org/10.4337/9781800885349.00014

Abstract

References

How to cite