SIFMA Recommends Changes to SEC-Proposed Electronic Recordkeeping Requirements

SIFMA recommended substantial changes to the SEC's proposed rulemaking on electronic recordkeeping requirements for broker-dealers, security-based swap dealers and major security-based swap participants (see previous coverage).

In their comments to the proposed rule, SIFMA recommended the following:

• eliminate third-party recordkeeping requirements, since service providers often don't have access to the data if it is encrypted;

• distinguish the term "senior officer" from the "senior officer" term that is found in various other security-based swap regulations;

• explicitly permit entities to designate multiple officers for accessing and producing records;

• permit senior officers to provide only the required records to which the officers have been designated as having access;

• adjust audit trail requirements to permit documents with tracked changes rather than requiring firms to have the ability to reproduce every iteration of a document;

• eliminate various audit trail sections, or amend them to exclude bank security-based swap entities from the new technical requirements;

• adjust various phrases and terms to provide additional clarity and technological neutrality; and

• grant entities an 18-month window to comply with the amended rules.

SIFMA asserted that its recommendations would make the regulations more technologically neutral.