While some businesses do not prioritize proper archiving of their emails as a part of record keeping, it is vital to understand its importance. The SEC can fine or possibly imprison those in charge of companies who fail to do so. The fines can potentially be steep for those charged with criminal liability – usually the executives or board members.
Reasons Why Companies Are Non-Compliant
While some organizations are simply defiant, others fail to implement archiving because of a lack of understanding of the regulations and mandates or possibly because they do not have the resources required. However, for companies who are not compliant, no matter what the cause, they are increasingly at risk for audits, government investigations, lawsuits and those fines mentioned above. Unfortunately, not knowing or understanding new regulation is not an excuse for non-compliance. If cost has previously been a factor for administrators who have avoided archiving their emails, they should consider the substantial cost they may pay both personally and collectively. Negligence can be catastrophic.
Let’s go thru the numbers
According to some sources, as much as 53 percent of businesses in the United States do not consider emails when managing their records, and a further 39 percent have no email retention policy. According to regulatory notice 10-06 published by FINRA (Financial Industry Regulatory Authority), the largest independent securities regulatory body, emails, chats, instant messaging and social media activity are all included under compliance regulations. Strict record keeping including archiving should be maintained to avoid criminal liability. While some companies have traditionally blocked access to chats, instant messaging and sites such as Facebook, many are reconsidering because of the marketing capital those outlets can potentially generate for the company. With that in mind, it is important to understand all pertinent regulations.
To get more information on how to achieve compliance,