AdviserSoftware.com, part of FTRC, has partnered with Robert Kirk, founder and CEO of InterGen Data, an AI-driven financial lifetime events prediction service, to assess risks and provide guidance for navigating DeepSeek.
AI presents considerable opportunities for financial advisers, and interest in DeepSeek has surged. To better understand the potential risks, AdviserSoftware and InterGen Data have examined DeepSeek’s terms and conditions and identified the following risks along with recommendations for advisers:
Key Risks:
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User liability for legal costs: According to Section 7.2, users must reimburse DeepSeek for legal fees, arbitration costs, attorney fees, travel expenses, and fines resulting from their actions, including liabilities from third-party claims related to alleged violations of laws, regulations, or platform rules.
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Data privacy and government access: DeepSeek stores all user inputs (text, audio, files, chat history) and outputs on servers in China, which are subject to local cybersecurity laws that may require companies to share data with authorities upon request. Collected information includes IP addresses, device identifiers, keystroke patterns, and payment details, raising privacy and compliance issues, particularly concerning GDPR.
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Content ownership and licensing: While users retain rights to their inputs, DeepSeek obtains extensive usage rights, including non-exclusive, perpetual licenses to store, modify, and distribute user-generated content for commercial purposes. Outputs may be used to train future models, potentially compromising sensitive information included in prompts.
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Compliance and monitoring: Inputs/outputs undergo compliance scanning, where prohibited content ranges from hate speech to politically sensitive topics, with violations possibly resulting in immediate suspension, content removal, or bans without prior notice.
- Third-party data sharing: SDKs from Chinese tech firms like Tencent and ByteDance may expose user data to advertising partners, analytics platforms, and entities aligned with governmental regulations under China’s data laws.
Recommendations:
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Avoid sharing sensitive data: Users should refrain from inputting sensitive or confidential information, as all interactions with DeepSeek are monitored and stored indefinitely.
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Consider jurisdictional risks: Be aware of data storage practices in China, especially concerning stringent data protection laws in the EU and UK.
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Audit third-party integrations: SDKs like Volcengine and Fengkongcloud increase exposure to Chinese infrastructure.
- Understand licensing terms: Generated content may be commercially repurposed by DeepSeek, affecting confidentiality and proprietary information.
Robert Kirk commented, "While the excitement of adopting cutting-edge technology is invigorating, the hidden risks surrounding data privacy, ownership, and liability are significant and should not be overlooked. Firms must establish a clear risk assessment framework and ensure their AI partners adhere to the highest standards of security, compliance, and ethical AI use.”
Ian McKenna, founder of AdviserSoftware.com, added, "The terms and conditions grant DeepSeek the right to store various types of information, including payment data. Advisers must grasp these issues in the context of any AI tools or services they utilize. Although the aforementioned points are not exhaustive, they highlight critical concerns that advisers should consistently understand and document before using any technology service.”