Install Technology to Facilitate Regulatory Compliance

Eager to promote accuracy, longevity, and easy access to trustworthy electronic records, the SEC provides specific requirements for the media and process used to archive e-mail, IM, and other electronic records.

While SEC Rule 17a-4 references only electronic communications, both the NASD and SEC have noted that IM falls under this umbrella. ^[6] Specifically, the SEC rule states:

1. Electronic records must be stored on nonrewriteable and nonerasable media.

2. The system must ‘‘verify automatically the quality and accuracy of the storage media recording process.’’

3. The organization using electronic records must provide regulators with ‘‘facilities for immediate, easily readable projection or production of . . . electronic storage media images and for producing easily readable images.’’

4. The system must ‘‘store separately from the original, a duplicate copy of the record.’’ ^[7]

   IM Rule # 31: Install the right technology to ensure regulatory compliance.

^[6]Communicator Inc. Press Release, ‘‘New Instant Messaging Regulations to Take Hold on Wall Street,’’ Business Wire (April 30, 2003).

^[7]SEC 17 CFR 240 17a-4. See also Nancy Flynn and Randolph Kahn, Esq., E-Mail Rules, New York, AMACOM, 2003.