How to Meet SEC Record Retention Requirements in the Digital Age

In today's digital landscape, financial institutions face the critical challenge of adhering to the Securities and Exchange Commission's (SEC) record retention requirements. Proper management and preservation of electronic records are not only legal obligations but also essential practices to ensure transparency and maintain investor trust.​

Understanding SEC Record Retention Requirements

The SEC mandates that broker-dealers and investment advisers maintain and preserve specific records for designated periods. These regulations, primarily outlined in SEC Rule 17a-4, stipulate that certain records be retained for periods ranging from two to six years, depending on the document type. For instance, general ledgers must be kept for six years, while other records, such as communications related to business operations, require a three-year retention period.

In October 2022, the SEC amended Rule 17a-4 to modernize recordkeeping requirements in response to technological advancements. These amendments provide firms with greater flexibility, allowing electronic records to be preserved in either a non-rewritable, non-erasable format (commonly known as Write Once, Read Many or WORM) or in systems that maintain a comprehensive audit trail.

Strategies for Compliance in the Digital Age

To effectively meet SEC record retention requirements in today's digital environment, financial institutions should consider the following strategies:

1. Implement Robust Electronic Recordkeeping Systems

Utilize systems capable of preserving records in compliance with SEC regulations. Whether opting for WORM storage or an audit-trail-enabled system, ensure that the chosen solution can accurately recreate original records if altered, overwritten, or erased. 

2. Comprehensive Employee Training

Educate staff on the importance of compliance with record retention policies. Training should cover the proper use of communication channels, the significance of preserving business-related communications, and the potential consequences of non-compliance. ​

3. Regular Monitoring and Auditing

Establish procedures to routinely monitor and review electronic communications and recordkeeping practices. Regular audits can help identify and address compliance gaps, ensuring that records are maintained as required and that any issues are promptly rectified. 

4. Utilize Compliance Solutions

Leverage technology solutions designed to facilitate compliance with SEC regulations. For example, integrating platforms that automatically archive communications and maintain audit trails can streamline the compliance process and reduce the risk of human error.​

Votacall + Global Relay does exactly that. Voice data from calls, voicemails, and messages is seamlessly archived in Global Relay's secure environment, providing your team with advanced search capabilities, centralized record access, and comprehensive audit trails. This not only simplifies regulatory readiness—it makes compliance a built-in feature of your day-to-day operations.

Consequences of Non-Compliance

Failure to adhere to SEC record retention requirements can result in significant penalties. In recent years, the SEC has intensified its enforcement actions against firms with inadequate recordkeeping practices. For instance, in August 2024, the SEC announced settlements totaling approximately $392.75 million with multiple financial institutions for widespread recordkeeping failures related to off-channel communications.

Meet SEC Standards with Confidence

Navigating SEC record retention requirements in the digital age demands a proactive and informed approach. By implementing robust electronic recordkeeping systems, providing comprehensive employee training, conducting regular audits, and leveraging compliance technologies, financial institutions can ensure adherence to regulations, thereby safeguarding their operations and maintaining the trust of their clients.​

Need a reliable solution that checks all the compliance boxes?

The Votacall and Global Relay integration was built specifically for financial institutions that need to meet SEC Rule 17a-4 requirements without added complexity. From WORM-compliant storage to audit trail visibility and automated voice archiving, our partnership makes compliance easier—so your team can stay focused on what matters most. Learn more about how Votacall and Global Relay can support your compliance strategy here.

For more information on the benefits of working with Votacall and Global Relay, check out our webinar below!