When Your Financial Advisor Uses AI: What It Means for Your Privacy

When Your Financial Advisor Uses AI: What It Means for Your Privacy

Financial advisors have always used data to understand their clients. But now, many are turning to artificial intelligence to sharpen their marketing and client management. A recent report in The Globe and Mail highlighted how AI can give advisors a marketing edge—but warned that privacy rules need close attention. For clients, this raises an important question: what happens to your personal financial information when your advisor uses AI tools?

What happened

The Globe and Mail article, published June 3, 2026, notes that advisors are using AI for tasks like personalizing investment recommendations, running chatbots for client questions, analysing spending patterns, and generating leads from prospect data. These tools can make services more efficient and tailored. But the same article points out that using AI often means sharing client data with third-party vendors, and not all firms are transparent about how that data is handled.

Why it matters to you

When your advisor enters your financial details—income, spending habits, risk tolerance, account balances—into an AI system, that data may leave the advisor’s own secure environment. Third-party AI platforms might store, process, or even train their models on it. Unlike a human advisor bound by professional confidentiality, an AI vendor’s data practices can be less clear.

Privacy laws like Canada’s PIPEDA, the EU’s GDPR, and California’s CCPA generally require that clients be told how their data is used and give consent for new uses. But these laws were written before AI became commonplace. Regulators are starting to catch up—the U.S. Securities and Exchange Commission (SEC) and securities regulators in Canada have issued guidance reminding firms that using AI does not exempt them from data protection rules. Still, enforcement cases are few, and the rules can be vague.

Another risk is bias. AI models trained on historical data may produce recommendations that inadvertently discriminate or misjudge certain client segments. If the model is wrong, it could lead to poor advice—and you may not know the decision was shaped by an algorithm rather than a human.

Finally, there is the question of opt-out. Can you choose not to have your data used for AI-driven marketing? Under some laws, you may have the right to object to automated processing. But many advisors do not proactively mention this option.

What readers can do

You do not need to reject AI outright, but you should know what is happening with your information. Here are a few practical steps:

• Ask your advisor directly. A simple question like “Do you use AI tools for marketing or client management, and if so, which vendors do you share my data with?” can start the conversation. A good advisor will give a clear answer.
• Read the privacy notice. Check the privacy policy your advisor provided when you opened the account. Look for mentions of “third-party analytics,” “machine learning,” or “automated decision-making.” If it is not mentioned, ask why.
• Inquire about data deletion. If you are a prospect whose data was used for lead generation, ask whether it can be removed from the AI vendor’s system.
• Know your rights. Under PIPEDA in Canada, you have the right to access your personal information and challenge its use. Under GDPR (if applicable), you can object to profiling. Even if your advisor is not legally required to grant every request, raising the issue shows you are paying attention.
• Watch for signs of bias. If a recommendation seems off or based on assumptions you did not share, ask how it was generated. A human advisor should be able to explain the reasoning behind any AI-assisted suggestion.

Balancing benefit with caution

AI can make financial advice more responsive and personalized. That can be a real benefit. But the trade-off is that your data becomes part of a larger system with less direct oversight. The responsible firms will be transparent and let you choose how your information is used. For now, the best protection is to stay informed and ask questions. The Globe and Mail article serves as a timely reminder: an edge for advisors should not come at the cost of your privacy.

Sources:

• The Globe and Mail, “AI can give advisors a marketing edge, but mind the privacy rules,” June 3, 2026.
• Office of the Privacy Commissioner of Canada, guidance on AI and PIPEDA.
• U.S. Securities and Exchange Commission, “AI and the Investment Adviser,” 2024 (general guidance).