Messaging Solutions LLC
Rules and Regulations
Compliance - Regulatory Overviews
Businesses and Governmental Agencies today must be up-to-date and compliant with a wide range of
state, federal, and international regulations. Below we
have listed a number of these and for some of the more complex, have
linked to the appropriate agency web site where you can gather further
information.
Basel II
Banks must create internal processes to control, supervise and enforce
risk management practices, including those involving internal
communications.
California Privacy Law
SB1386
Businesses are required to notify California residents if personal
information stored on computer systems has been breached. This
regulation applies to any organization that conducts business with
California residents. A company is exempt from the notification
requirement of California SB 1386 if the personal information is
stored in encrypted format.
FDIC Advisory:
Information Technology Risk Mgmt Program
Requires encryption of electronic customer information while in
transit or in storage.
Gramm-Leach Bliley Act
Financial institutions must ensure the security of non-public personal
information; as such, they are required to maintain and store these
communications in compliance with the SEC's Rule
240.17a-4 and NASD's rules 3010 and
3110 (all emails be preserved for a period of
not less than six years, with the first two years in an easily
accessible place.)
IDA 29.7 (The
Investment Dealers Association of Canada)
All client correspondence and related documents, including emails,
must be retained for five years from the date of creation. In
addition, all sales literature and related documents must be retained
for two years from the date of creation. Archived sales literature and
correspondence must be readily available for inspection by the
Association at all times.
Investment
Advisors Act
Investment advisers shall make and keep records in accordance with the
Securities Exchange Act of 1934 as well as allow the Commission to
examine such records as the Commission deems necessary or appropriate
in the public interest or for the protection of investors. Investment
advisers are also required to maintain and preserve books and records
in an easily accessible location for at least five years from the end
of the fiscal year during which the last entry was made, the first two
years in an appropriate office of the investment advisers.
NASD 2210
All sales literature and correspondence made available to customers or
the public (including email) must be a maintained for three years from
the date of each use including the name of the person who prepared the
literature and/or approved their use. Any communications (including
email) that deal with the performance of past recommendations or
actual transactions and completed worksheets should be stored at a
place easily accessible to the sales office for the accounts or
customers involved.
NASD 2711
All research reports, including any written or electronic
communication that includes an analysis of equity securities of
individual companies or industries, and that provides information
reasonably sufficient upon which to base an investment decision, must
be retained for three years following its publication.
NASD 3010
A system should be established and maintained to supervise activities
of all registered representatives, including the use of e-mail and
websites. Written procedures must be developed for the review of any
written and electronic correspondence with the public relating to
investment banking or securities business. If an electronic or manual
pre-use review is not done, then appropriate supervisory procedures
should be developed, as well as monitoring and testing the procedures,
educating employees on the procedures and documenting the education of
the employees. All correspondence relating to investment banking or
securities business should be retained along with the names of the
persons who prepared and reviewed the correspondence, and the retained
records should be readily available to NASD. An annual review of a
broker/dealer’s business activities, supervisory system, customer
accounts and office inspections is required. Click here for additional
information on NASD 3010, 3012 and 3013.
NASD 3012
Member firms must (i) have supervisory control procedures that test
and verify that the members’ supervisory procedures are reasonably
designed to achieve compliance with applicable securities laws and
regulations and NASD rules, and (ii) where necessary, amend or create
additional supervisory procedures. Click here for additional
information on NASD 3010, 3012 and 3013.
NASD 3013
The CEO of each member firm must certify that they have a process to
adopt compliance policies and supervisory procedures reasonably
designed to achieve compliance with applicable securities laws and
regulations and NASD rules. Click here for additional information on
NASD 3010, 3012 and 3013.
NASD 3110
All books, accounts, records, memoranda and correspondence should be
retained in the same format as stated in SEC Rule 17a-4 (i.e.
non-rewriteable, non-erasable, and time-stamped). All e-mails and
Internet communications which relate to the broker/dealer’s business
must be retained for at least three years, the first two years in an
easily accessible place.
OCC Advisory:
Electronic record Keeping
Banks should implement an electronic record retention system to allow
litigation, audits, bank supervision, and compliance with laws &
regulations. Systems should also prevent external access by third
parties, and provide back-up, internal controls, record destruction,
and record retention.
Sarbanes-Oxley Act
Requires public companies save all business records, including
electronic records and messages, for no less than five years. All
relevant audit-related documentation (including email records) must be
retained for seven years. Section 404 also requires companies to
report on the effectiveness of internal controls over financial
reporting. Since internal control decisions and data are discussed,
transported and stored in corporate email systems, ensuring that email
data cannot be accessed or tampered with is considered critical to the
reliability of financial reporting.
SEC 17a(3,4)
A broker or dealer must preserve documents and records for three to
six years, the first two years of which, they must be in an accessible
place. All documents and records must be time-stamped, stored in a
non-rewriteable/non-erasable format, organized and indexed, with a
duplicate copy stored separately from the original. The indexes should
be also duplicated and stored separately from the original, and they
should be available for examination and preserved as long as the
documents and records.
Texas Public Information
Act
The
Texas Public Information Act (TPIA or the Act) gives the public
the right to request access to government information. The
Public Information Act applies to information of every "governmental
body."
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