Regulators Begin Scrutiny of AI Systems That Target Users at Vulnerable Moments

Digital platforms can now infer users' emotional and financial states in real time and deploy loan offers or persuasive prompts precisely when individuals are most vulnerable, raising serious questions about consent and manipulation. A peer-reviewed paper published in Frontiers in Psychology in April 2026 found that AI-driven design increasingly exploits inferred cognitive and emotional vulnerability to influence user decisions. The UK's Treasury Select Committee warned in January 2026 that British regulators were insufficiently managing AI risks, prompting the FCA's Mills Review to examine how Consumer Duty rules apply to AI personalisation. The EU AI Act's Article 5 prohibitions on AI systems exploiting socio-economic or psychological vulnerabilities became enforceable in February 2025, carrying fines of up to 35 million euros or 7% of global turnover. Meanwhile, the affective computing market — technologies that detect and respond to human emotions — is projected to grow from roughly $100 billion in 2025 to over $300 billion by the early 2030s, far outpacing the legal frameworks meant to govern it.
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