Susan, Peter, et. al.,
I've recently been doing a bit of research into SEC retention
for Broker/Dealers (17 CFR 240.17a4) and will toss my two cents into the mix.
Before I spout my opinion, a little background on me since I'm new to
Listserv. I have 20+ years of Fed Govt RM experience and although not a CRM
(yet), I've put in my share of time poking in the US Code, CFR's, Fed
GRS, and various Dept retention schedules (SF 115's etc). The vast majority
my time was with DoD and now I'm with an Dept in transition (private
consultant). I'm not a lawyer, but frequently avail myself of their
in the wherefore's and party of the first parts. And despite the fact that
has taken a lot of the guess work out of RM for it's employees, management
politicos, there is a fair share of cutting edge RM being done there.
In DoD you followed the retention rules or you wound up breaking rocks at Ft
Leavenworth; Title 18 is alive and well.
What we're talking about here is ethics. I laughed when the Clinton
administration said they couldn't provide their emails (fundraising scandal
'98) because they originally couldn't find the emails and then when they did
find them, said there was a technical glitch that would prevent them from
read. Nonsense. Eventually they paid enough money and supplied the emails.
Company X is going to catch it in the shorts if they destroy the email
forget to destroy all the IT/IS engineering blueprints/designs in the IT
department detailing how the IS was put together. As a post 9/11 measure,
IT depts have been (literally) under the gun to keep better records of how
systems are designed so they can recreate the business records after a
catastrophe. Any lawyer worth his/her salt would prove that despite the
Company X could recreate the email because they still retained the IS
If the emails supported any of the transactions covered by 17 CFR, they
would have to keep them 6 years -- the first 2 years in an "easily
place." Also not in X's favor is the fact that they would've notified their
examing authority of their intention to use electronic storage media before
implementing such a system -- which abrogates their claims to destroy the
records prior to 6 years for whatever reason.
Company Y is in a much better position to comply by simply holding on to
records and hoping they never have a lawsuit (HA!) They are under no
to maintain any equipment, but they, like Company X, (if we're talking
broker/dealers), need to "...have the capacity to readily download indexes
records preserved on the electronic storage media..." Now you have
for the lawyers to bite into when arguing what "readily download" means.
I think in both cases, if the companies survive their litigation, the
consumers/taxpayers will pay for all the costs in the long run.
With regard to fed govt records - if you don't destroy on time, anything
do have on hand is subject to FOIA, even if it should've been destroyed. If
discover records that haven't been destroyed and then destroy them, if it is
later discovered (in court) that you destroyed them you will be prosecuted
And finally, the SEC has the teeth in the law to take these companies
It is a matter of political and economic will that will decide if we let
"get away with it."
<<getting down off my soap box>>
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