Press Release (ePRNews.com) - NEW YORK - Jan 14, 2017 - By Allan Lonz, President www.advisorvault.org
SEC Rule 17a-4 and Small FINRA Firms
Archiving data for SEC rule 17a-4 has become a thorn in the side of FINRA firms – of all sizes. But it’s especially painful for small firms, such as Broker-Dealers and RIA’s who have a limited IT budget yet face stringent demands surrounding the archiving and supervision of electronic records. And since spending on data compliance doesn’t actually add to the bottom line, but simply exists to keep auditors happy, it’s important that firms continually find ways to keep this cost low as possible.
To complicate things further, most small FINRA firms are moving towards a paperless office where data is stored in multiple places such as the cloud, on mobile devices, corporate servers and PC’s. This puts extra pressure on compliance officers to find a consolidated solution that will automate the transfer of this dispersed data to a designated third party’s 17a-4 compliant storage.
“We continually update our FINRA remote archiving software to give our customers the most flexibility to archive and access data for SEC rule 17a-4.” Said Allan Lonz, President of AdvisorVault, “Its critical, especially for small FINRA firms such as broker-dealers and RIAs to have a complete solution to make sure they pass an audit, especially the yearly electronic records request, and this is exactly what we strive to offer.” Added Lonz.
The Three Demands of SEC Rule 17a-4
Although 17a-4 is a complex document, it points to three basic things that firms need to do. Also, FINRA firms need to understand is that it doesn’t matter where data is stored, whether its uploaded to the cloud, on local PCs, corporate server or mobile devices, or in the cloud, as long as they do the following to satisfy SEC rule 17a-4:
Firstly, compliance officers need to do their regular daily or weekly compliance reviews of data contained in books and records and other communications relating to its operation. This is something FINRA will expect before they come in for their audit, there has to be proof that emails are being reviewed and samples of the firms books and records can be access or viewed.
Second, reproduce data for electronic records requests during the 17a-4 audit. During the FINRA audit, the regulator will need a sample of the firm’s books and records in electronic format, it must downloadable to disk in its original format so the regulator can read it
Finally, the firm needs to prove that can perform disaster recovery of critical data and system data (with 48 hrs. following a disaster) either back to its original location or to an alternate disaster recovery site
To Fully satisfy auditors, small FINRA firms surely need to outsource the archiving of electronic records for rule 17a-4. However, they need to choose a provide that has the software which is flexible but also has the ability to keep current data readily available, no matter where its stored and. In addition, compliance officers need to do their daily electronic records supervision while at the same time making archived data accessible in its original format when FINRA or SEC requests data for their yearly audits.
Key Features of AdvisorVault’s Remote Data Archiving Software:
AdvisorVault’s 17a-4 remote archiving software has all the features need by small FINRA firms to make sure data is most effectively archived and made available for regular review, an audit or during a disaster, the key features of AdvisorVault’s software:
Replicate to 17a-4 Storage: The regular compliance reviews of electronic records is the first thing auditors expect from a firm. This means critical data relating to the Books and Records must be searchable so it can be retrieved and flagged if not compliant or contains misleading language. the replicate feature of AdvisorVault’s 17a-4 software retains current data for three years and keeps it readily available to compliance officers to perform daily or weekly review.
Move to the Cloud: The yearly FINRA electronic records request is the second main demand of SEC rule 17a-4. The is especially critical for Broker-Dealer firms with a transactions and client communications. After three years, our Move to the Cloud feature transfers unchanged data and archives it within AdvisorVault for seven years. This option frees up expensive storage and makes historical records that are easy to retrieve for auditors during the FINRA electronic records request.
Temporarily Retain: FINRA requires firms to create a business continuity plan (BCP) relating to an emergency or significant business disruption. This plan Data backup and recovery of all mission critical systems; to Alternate physical locationThe Temporarily Retain feature keeps critical data on hand for quick recovery following a disaster, which makes systems available for restore either back to their original state or to an alternate location within 48 hours after a failure.
A Consolidated Solution
It’s critical that small FINRA firms use a consolidate solution to achieve 17-4. Broker-Dealers and RIA surely need to outsourcing to a third party with all the features built into their software, such the flexibility to retain different data for different time periods, move older data off expensive storage yet keep current other data for recovery in a disaster is the keep to data compliance.
In addition, they need to include all data, ever highly distributed information stored on mobile devices or the cloud, in the small way local data on office pcs or corporate servers. Also, since data compliance spending needs to kept low as possible, the last thing small firms want to do is spend more than they have to, especially for the long-term archiving of electronic records, the ultimate goal is to automate the whole process to make sure regulators are out the door faster.
AdvisorVault is the only third party provider that has created a SEC 17a-4 compliant archiving solution designed specifically for small FINRA firms. The product remotely archives all data and consolidates it into one platform that is accessed through a secure website. Our complete approach protects data and email residing in the cloud, on internal systems and laptops, as well as on mobile devices and in branch offices.
Allan Lonz, President Source :
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