Trade Groups Seek Updates to SEC Electronic Recordkeeping Rule

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By Phyllis Diamond

Five financial trade associations Nov. 14 called on the SEC to update its recordkeeping rules by eliminating a requirement that broker-dealers maintain electronic records in a non-rewritable, non-erasable “WORM” format.

In place of WORM—write once, read many—the groups proposed that the Securities and Exchange Commission adopt a principles-based, technology neutral record retention rule more consistent with current record-management standards. The proposed changes also would harmonize SEC rules with related Commodity Futures Trading Commission rules adopted earlier this year, the groups said.

“The 20-year old standards are outdated, costly, and no longer effectively provide investor protections,” Melissa MacGregor, Securities Industry and Financial Markets Association Associate General Counsel said in a statement. She said updating the rule would foster innovation and promote the industry’s “technological advancement and competitive opportunities.”

The letter was signed by SIFMA. the Financial Services Roundtable, the Financial Services Institute, the Futures Industry Association, and the International Swaps and Derivatives Association. Through a spokeswoman, the SEC declined to comment.

To contact the reporter on this story: Phyllis Diamond in Washington at pdiamond@bna.com

To contact the editor responsible for this story: Seth Stern at sstern@bna.com

For More Information

To see the letter, go to http://src.bna.com/udh

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