Extract from Cassandre Coyer’s article “New SEC Recordkeeping Rule Unlikely to Strain Organizations’ E-Discovery Efforts”
In the face of fast evolving technology, the U.S. Securities and Exchange Commission is once again playing catch-up.
On Oct. 12, the SEC modernized its broker-dealer electronic recordkeeping rule to allow, among other things, for electronic records to be preserved using audit-trail methodology as an alternative to the current nonrewritable, nonerasable format also known as the “write once, read many” format.
Additionally, the SEC will now also require broker-dealers and all types of security-based swap dealers (SBSDs) and major security-based swap participants (MSBSPs) to produce electronic records to securities regulators in what it called a “reasonably usable electronic format.”
While the new regulation will better fit modern forms of communication, experts don’t see the updated rule having groundbreaking ramifications on e-discovery.
“The reasonably usable electronic format, again, to me at least immediately, I think it mirrors a lot of the language that we’ve had for a long time in the world of discovery, not even just e-discovery but in discovery, that it has to be in a reasonably usable format,” said Brett Burney, principal at Burney Consultants and eLaw evangelist at Nextpoint. “So they just threw in ‘electronic’ there.”
As the update was long-awaited, it is likely not taking many by surprise, and Burney noted that he doesn’t expect companies to face significant challenges to comply.
