How shadow AI and hidden subprocessors are challenging governance and compliance efforts

63.6% of AI vendors fail to disclose subprocessor activity in data protection assessments, creating hidden compliance gaps under EU AI Act, CCPA and emerging regulations. Companies risk unknowingly breaching disclosure requirements whilst relying on incomplete vendor due-diligence.

This Wire brief sits within Fusion42's coverage of AI Infrastructure and Cybersecurity. Wire is Fusion42's founder-focused intelligence feed: each story is connected to the funds and startups it names — every one with a live profile on Raise or Scout — so founders can follow the capital and the momentum behind the headline rather than just the headline itself. Wire analysis is one of the live surfaces Arthur reasons over.