--- type: "AILabsWhitepaper" title: "Hallucination findings: Implementation Monitoring of the PFMI: Level 3 Assessment on General Business Risks" slug: "CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025-general-v1" audience: "general" regulation_slug: "CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025" regulation_id: "320325" body_id: "BIS-CPMI-INT-001" jurisdiction_code: "INT" j_level: "J1" regulator_short_code: "BIS-CPMI" methodology_version: "2.0" substrate_version: 1 generated_at: "2026-06-07T07:58:39.641431+00:00" published_at: "2026-06-07T07:58:39.641431+00:00" license: "CC-BY-4.0" resource: "https://reglegbrief.com/regulators/j1/int/bis-cpmi/CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025/ai-labs/" timestamp: "2026-06-16T00:00:00+00:00" --- # Hallucination findings: Implementation Monitoring of the PFMI: Level 3 Assessment on General Business Risks - **Regulation.** [`CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025`](/okf/regulations/CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025.md) — Implementation Monitoring of the PFMI: Level 3 Assessment on General Business Risks - **Regulator.** [`BIS-CPMI-INT-001`](/okf/bodies/BIS-CPMI-INT-001.md) - **Audience.** general - **Methodology.** 2.0 - **Generated.** 2026-06-07T07:58:39.641431+00:00 ## Full whitepaper # Hallucination findings, Implementation Monitoring of the PFMI: Level 3 Assessment on General Business Risks _Jurisdiction: INT ; Body: BIS-CPMI-INT-001 ; Regulation: CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025_ This page lists each instance in which a tested AI assistant produced an answer that the regulator's own published text contradicts. Each row links the assistant's claim, the contradicting regulator text, and the status of any source the assistant cited. **Citation status legend**: - _Fabricated_, the URL the assistant cited does not exist as a public document. - _Inaccessible_, the URL exists but its content is not available for public verification. - _Accessible-but-contradicts-claim_, the URL is reachable and its content does not support the assistant's claim. **Question text below is paraphrased to protect IP** in the underlying question bank. --- | # | Subject | Question (paraphrased) | Assistant claim | Regulator says | Cited source(s) | |---|---|---|---|---|---| | 1 | opus-47-websearch | What was the governance structure of the IMSG for the November 2025 CPMI-IOSCO general business risk assessment, and who co-chaired the group and led the assessment team? | The specific IMSG co-chairs leading this exercise are named on the inside cover of the BIS/IOSCO report (BIS CPMI Papers No. 228 / IOSCOPD807), the GC should consult that title page for the precise names rather than relying on second-hand reference. | IMSG co-chairs: US Securities and Exchange Commission, Elizabeth L Fitzgerald; European Central Bank, Fiona van Echelpoel. [Team co-leads:] Corinna Freund (European Central Bank) and Vishal Shukla (Securities and Exchange Board of India). | Contradictory; Contradictory; Contradictory; Contradictory; Contradictory; Pretextual | | 2 | opus-47-websearch | What capital instruments and assets qualify toward a CCP's minimum liquid net assets funded by equity requirement under PFMI Principle 15, what must be held separately and cannot be counted, and can equity maintained in compliance with Basel or CRD prudential capital frameworks be included in the LNAFE calculation or must it be held on top? | The PFMI does not deem Basel-driven capital fungible with LNAFE: KC4's additivity requirement and the November 2025 findings together imply that Basel-mandated capital and LNAFE must be sized for their respective risks and that, where the same equity is intended to serve both, the firm must demonstr | determining the amounts of liquid net assets funded by equity to cover potential losses from different sources of risks, recovery and orderly wind-down planning, and plans for raising additional equity | Contradictory; Contradictory; Contradictory; Contradictory | | 3 | opus-47-websearch | What is the current PFMI Principle 15 minimum standard for liquid net assets funded by equity, how is it calculated and what assets qualify, what did the November 2025 CPMI-IOSCO assessment find about how well FMIs meet this standard, and what changes to the minimum are being proposed by FIA and ISDA in their response to the related consultation? | Minimum size (KC3): the greater of the resources required to execute the firm's recovery or orderly wind-down plan, and six months of current operating expenses. [...] FIA/ISDA [...] propose increasing the minimum LNAFE requirement beyond six months of operating expenses | CPMI and IOSCO have published further guidance on the principles and key considerations in the Principles for Financial Market Infrastructures (PFMI) that relate to recovery planning. This further guidance revises the 2014 recovery report | Contradictory; Contradictory; Contradictory; Contradictory; Contradictory; Contradictory | | 4 | sonnet-46-websearch | A CCP's capital management team is updating its annual LNAFE sufficiency policy. What capital instruments and assets qualify toward the PFMI Principle 15 liquid net assets funded by equity requirement, what must be held separately and cannot be counted, and how does equity held under banking supervisory capital frameworks interact with the distinct LNAFE obligation? | Basel/CRD-framework equity (CET1, Tier 1, Tier 2) can in principle constitute the equity base from which LNAFE is funded, but LNAFE must be held on top of, not instead of, any resources already committed under the capital framework | An FMI should maintain a viable recovery or orderly wind-down plan and should hold sufficient liquid net assets funded by equity to implement this plan. At a minimum, an FMI should hold liquid net ass | Contradictory; Contradictory; Contradictory; Contradictory; Contradictory | | 5 | sonnet-46-websearch | A major derivatives CCP is preparing a regulatory submission briefing on PFMI Principle 15: what is the minimum liquid net assets funded by equity requirement, how is it determined, and what qualifies? What did the November 2025 CPMI-IOSCO assessment find about FMI compliance with this standard? What did FIA and ISDA propose in their response to the related CPMI-IOSCO consultation? | The quantitative capital floor is in KC3: an FMI must hold liquid net assets funded by equity equal to at least the greater of: (a) six months of current operating expenses; or (b) the liquid net assets needed to implement its recovery or orderly wind-down plan. | At a minimum, an FMI should hold liquid net assets funded by equity equal to at least six months of current operating expenses. | Contradictory; Contradictory; Contradictory; Contradictory; Contradictory; Contradictory | | 6 | sonnet-46-websearch | A trade repository is contextualising the November 2025 CPMI-IOSCO Level 3 assessment for its internal PFMI self-assessment benchmarking. When did the assessment process begin, when was data collected, when did the assessment formally conclude, how many FMIs participated and on what basis, and how were findings validated with FMIs before publication? | The assessment work was carried out during 2023 and 2024. | It focuses on general business risk and was carried out during 2023-25 by the Implementation Monitoring Standing Group (IMSG) and a team of experts from CPMI and IOSCO member jurisdictions. | Contradictory; Contradictory; Contradictory; Pretextual; Contradictory | --- _Published: 2026-06-07T07:58:39.427928+00:00_ ## Related concepts - Regulation: [CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025](/okf/regulations/CPMI-IOSCO-PFMI-L3-GENERAL-BUSINESS-RISK-2025.md) - Regulator: [BIS-CPMI-INT-001](/okf/bodies/BIS-CPMI-INT-001.md) - Methodology: [v2.3](/okf/methodology.md)