Sec and Finra Email Archiving

The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) were created in July 2007 through the consolidation of the NASD and the regulation enforcement and arbitration functions of the New York Stock Exchange. They are the primary regulatory agencies for the financial services industry.

Message storage, retrieval and surveillance solutions need to be in place in order for companies to be compliant with a number of regulatory guidelines. A number of which overlap and/or reinforce each other - including: SEC 17a-3 and 17a-4, NASD 3010 and 3110, NYSE 342, 440 & 442 and SEC RIA 204-2 and 206(4)-7.

Highlights of these rules include:

• Firms must preserve electronic business records and retain for 3-6 year retention period. (SEC 17a-4)
• Messages must be stored in their original form on tamperproof, non-rewriteable and non-erasable media and must be stored in duplicate in separate locations. (SEC 17a-4)
• Archived messages must be time/date stamped and serialized. Messages must be indexed and searchable. (SEC Rule 17a-4)
• Firms must have an auditing system in place and store audit records. (SEC 17a-4)
• Firms must appoint an independent third party downloader to access the organization's electronic records, if the firm is unable or unwilling to do so. (SEC 17a-4)
• Policy and procedures should be in place to supervise, review and sample registered representatives' electronic communication. Supervisors must have the ability to review outgoing email for noncompliant language. (NASD 3010)
• Firms need to be able to show that supervisory procedures are being enforced with documented records. (NASD 3010)