Everywhere registered investment advisors (RIAs) turn, someone is touting the wonders of AI. Tech vendors promise it will fix your workflows. Marketing gurus claim it will write your emails. Headlines suggest it might even pick stocks better than a human.
For most industries, moving fast with new tech is fine. If a retailer’s AI makes a mistake, they send a coupon. But if a wealth management firm makes a mistake, they face regulatory fines, reputational damage, and lost trust.
Firms like yours operate under fiduciary standards and strict compliance rules. Your business is built on confidentiality. So, when you hear the hype, you are right to be skeptical. However, you do not need to ignore AI to stay safe. You simply have to understand the boundaries of the technology.
What your RIA firm should NOT do with AI
The biggest risks for financial advisors come from using the wrong tools the wrong way. Avoid these three common traps to keep your firm secure.
Don’t feed client data into public models
Free tools such as the standard version of ChatGPT are powerful, but they often “learn” from the information you provide. If you paste a client’s portfolio details or personally identifiable information into a public chatbot, that data effectively leaves your firm’s control. It could potentially resurface in answers given to other users.
Treat public AI models like a public message board. If you wouldn’t post a client’s financial plan on social media, don’t paste it into a free AI tool.
Don’t overpromise in marketing
The SEC has increased its scrutiny on AI washing, which happens when firms exaggerate their use of artificial intelligence to attract clients. If your marketing materials claim you use AI to “optimize returns” or “beat the market,” you must have the rigorous processes and documentation to prove it.
Avoid vague claims. If you use AI for administrative efficiency, say that. Don’t imply it’s managing money unless it really is.
Don’t remove the human from the loop
AI models hallucinate. They can confidently state facts that are completely wrong. Never let an AI tool send an email to a client, publish a market update, or generate a compliance report without a human review.
Your duty of care remains with you, not the software. AI works best as a drafter, not a decision-maker.
What your RIA should do with AI
Being prudent is smart, but rejecting AI altogether means forfeiting major workflow improvements. There are several low-risk ways to use this technology right now.
Drafting content
Use AI to create the first draft of routine client emails or newsletters. It beats staring at a blank page. You can then refine the tone, verify the facts, and handle the final delivery.
Summarizing meetings
Record client meetings (with client permission) and use AI tools to generate a summary of action items. This creates an immediate compliance record and saves hours of administrative work.
Querying internal knowledge
Instead of digging through PDFs, use secure AI tools to query your own internal compliance manuals. You can ask, “What is the process for opening a new account?” and let the tool find the answer for you.
Why Microsoft Copilot is the safer choice for RIAs
Many RIA and wealth management firms struggle to find tools that balance power with privacy. Microsoft Copilot for Microsoft 365 solves this security gap.
Commercial data protection
Microsoft’s commercial Copilot license guarantees that your inputs are never used to teach the public algorithms. Your prompts and the data Copilot accesses remain within your Microsoft environment. This distinction is critical for compliance. It keeps your proprietary strategies and client information isolated from the outside world.
Integration with your files
Copilot offers value because it already knows your data. It can securely access your emails, Teams chats, and OneDrive files. You can ask it to “Draft an email to the Smith family based on the meeting notes from last Tuesday,” and it will pull context from the specific file you reference. Public AI tools can’t do that securely.
Security configuration
Copilot adheres to the permissions you have already set. If a junior advisor isn’t allowed to access a folder containing high-net-worth client data, Copilot will not show them results from that folder. The tool respects your existing hierarchy.
Because there is a lot to consider when making the switch, we have curated a Copilot for RIAs: Resource Center to provide firms with the deep dives and guides needed for a successful rollout.
Practical steps to implement AI securely
Before you roll out Copilot or any AI tool, your firm needs to prepare its environment.
- Audit your data permissions: AI makes finding files easier. If your internal permissions are loose — for example, if everyone has access to HR files or sensitive client data — AI will surface that information to anyone who asks. Review and tighten your access controls first.
- Create an acceptable use policy: Define exactly what staff can and cannot do. Can they use AI for internal brainstorming? Yes. Can they use it to analyze a specific client’s tax return? Only if it is a private, approved instance. Clear rules prevent accidental data leaks.
- Start small: Pick one specific use case, such as automating email drafts or creating meeting notes. Master that workflow and verify that it’s safe before you try to overhaul any process.
Partner with RIA WorkSpace for safe AI adoption
AI offers incredible leverage for RIAs and financial advisors, but implementing the technology requires more than just buying a license. Proper configuration is crucial for safeguarding sensitive client files and meeting compliance requirements. RIA WorkSpace can help you configure your Microsoft 365 environment, set up strict data governance, and deploy Copilot securely.
Contact us today to discuss your firm’s AI readiness and how to move forward safely.
| Looking for a central hub to help your team navigate these new tools? Visit our Copilot for RIAs: Resource Center. You’ll find everything from license requirements to a downloadable Copilot Prompt Guide, designed specifically for the tasks wealth management teams perform every day. |