# SEBI readies AI rules with kill-switch, human oversight 2026-08-22T18:15:37+00:00 | Governance | Indian Opinion Desk Corroboration: 1 independent outlet The Securities and Exchange Board of India (SEBI) is preparing guidelines for the responsible use of artificial intelligence (AI) and machine learning (ML) in the securities market, SEBI chairman Tuhin Kanta Pandey announced at the 23rd FICCI Capital Markets Conference 2026. The proposed tiered framework will include human oversight requirements, stronger data controls, and kill-switch mechanisms to halt AI systems if they behave abnormally. The move follows a May 2025 SEBI circular requiring mutual funds to report their use of AI or ML applications. That circular mandated disclosures on how AI is implemented and what safeguards exist. The new market-wide framework is expected to build on this, adding liability and explainability standards, as AI becomes more embedded in investment advice and compliance. ## Indian Opinion Analysis SEBI already uses AI tools itself, such as Project SUDARSAN, which scans social media for fraudulent investment content, and R(AI)DAR, which reviews mutual fund ads for misleading claims. The challenge ahead is not just writing rules but enforcing them as AI models become more opaque. The next concrete test will be how SEBI handles cases where an AI-driven system causes investor losses, and whether its liability framework assigns responsibility to the firm regardless of whether the tech was built in-house or procured externally. Watch for the draft guidelines, expected later this year. ## Coverage - barandbench.com Explains SEBI's regulatory powers and upcoming guidelines without taking sides, frames the issue as a regulatory challenge, not a political one. This story was synthesised by AI from the source linked above. Tags: FICCI, Project SUDARSAN, R(AI)DAR, SEBI, Tuhin Kanta Pandey Canonical: https://indianopinion.org/sebi-readies-ai-rules-with-kill-switch-human-oversight/ License: Summary and commentary (c) Indian Opinion, reusable with attribution. Facts belong to the linked sources. Cite: https://indianopinion.org/sebi-readies-ai-rules-with-kill-switch-human-oversight/#story-in-brief Review state: restored archive article, accurate at time of publication, not offered to search indexes. How this brief was made: an AI model read the report linked above and wrote this summary and analysis, which were published automatically. Published briefs are sampled every hour by an automated quality check; the editor verifies its findings and approves corrections, and corrected briefs carry a dated correction line. We do no original reporting. Methodology: https://indianopinion.org/ai-use-policy/