Evaluating AI for Finance: Is AI Credible at Assessing Investment Risk?

We evaluate the credibility of leading AI models in assessing investment risk appetite. Our analysis spans proprietary (GPT-4, Claude 3.7, Gemini 1.5) and open-weight models (LLaMA 3.1/3.3, DeepSeek-V3, Mistral-small), using 1,720 user profiles constructed with 16 risk-relevant features across 10 countries and both genders. We observe significant variance across models in score distributions and demographic sensitivity. For example, GPT-4o assigns higher risk scores to Nigerian and Indonesian profiles, while LLaMA and DeepSeek show opposite gender tendencies in risk classification. While some models (e.g., GPT-4o, LLaMA 3.1) align closely with expected scores in low- and mid-risk ranges, none maintain consistent performance across regions and demographics. Our findings highlight the need for rigorous, standardized evaluations of AI systems in regulated financial contexts to prevent bias, opacity, and inconsistency in real-world deployment.

Language Models are Homer Simpson! Safety Re-Alignment of Fine-tuned Language Models through Task Arithmetic

Aligned language models face a significant limitation as their fine-tuning often results in compromised safety. To tackle this, we propose a simple method RESTA that performs LLM safety realignment. RESTA stands for REstoring Safety through Task Arithmetic. At its core, it involves a simple arithmetic addition of a safety vector to the weights of the compromised model. We demonstrate the effectiveness of RESTA in both parameter-efficient and full fine-tuning, covering a wide range of downstream tasks, including instruction following in Chinese, English, and Hindi, as well as problem-solving capabilities in Code and Math. We also showcase the generalizability of RESTA on three existing safety evaluation benchmarks and a multilingual benchmark dataset proposed as a part of this work, consisting of 550 harmful questions covering 11 categories, each with 5 sub-categories of harm. Overall, RESTA decreases the harmfulness of the compromised model from 18.6% to 5.1% and from 9.2% to 1.5% in parameter-efficient and full fine-tuning, respectively, while maintaining most of the model's performance on the task. We release the source codes at: https://github.com/declare-lab/resta.