Scam alert: One-third of Britons ready to let AI handle their money despite 'red flags' - how to avoid fraud

Research shows that while AI platforms such as ChatGPT and Google Gemini are used daily by 42 per cent of Europeans, there is a tension between convenience and trust when it comes to serious money matters.

Some 30 per cent of people in Britain would let AI manage their money independently, while more than a quarter overall would trust digital assistants to make financial decisions.

Financial experts warn this could be dangerous as some chatbots have already suggested harmful actions to users.

Aaron Peake, a product manager from CredAbility, said: "You can't take something as fact simply because a chatbot says it with confidence."

He pointed out that bad advice is already common online, and AI has made the problem worse.

Examples include chatbots telling people to cancel loan direct debits as a way to "save money", a move that could ruin their credit score.

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Others have advised cutting pensions or insurance to reduce costs, leaving people completely unprotected. There is also confusion around country-specific rules.

Siobhan Blabrough, financial crime manager at, Ocean Finance warned that AI is not only changing how people seek information, but how fraudsters operate. Fake AI tools can pose as banks or advisers to steal sensitive data.

So how can people tell when AI is giving out bad advice? Experts highlight five warning signs.

1. Look for missing context: “AI can be brilliant at explaining things simply, but it often skips the fine print. A mortgage deal might sound amazing until you read the fees, penalties, and conditions hidden in the small print.”

2. Watch out for generic answers: “If the advice sounds like it could apply to anyone from a student to a retiree, it’s not tailored to you. Real advice should take your age, income, and goals into account."

3. Question anything that sounds too good to be true: “AI can make risky or unrealistic strategies sound perfectly sensible. If a tip promises fast riches, massive savings overnight, or a guaranteed return, treat it as a red flag.”

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4. Double-check the sources: “Good advice always comes with proof. If an AI tool can’t point to a trusted source, a Government site, or a regulated financial body, don’t rely on it.”

5. Don’t skip the human safety net: “AI can be a helpful starting point, but it should never be the final word. Use it to gather ideas, then confirm anything important with a qualified adviser or a trusted source.”

Mr Peake said: "If you wouldn't trust a stranger in the pub with your mortgage or pension decisions, you shouldn't blindly trust a chatbot either."