Is Worm Disk the Only Way to Retain Data for SEC Rule 17a-4?

Broker-Dealers are no longer restricted to using only worm disk to store electronic records to satisfy rule 17a-4.  This used to be the case but was changed by the SEC in 2003.  Because of the increase in data amount and new technology, 17a-4 was amended to allow Broker-Dealers who are FINRA members to store electronic records in a non-rewriteable, no-erasable format by the use of software codes which prevents erasing, and not through the use of worm disk.

This has a huge impact of small FINRA firms because they can now easily outsource their data archiving to third party providers that offer software which has the features built into their solution and can simply specify an expiry or retention period for data storage. Then after this expiry period or retention date the records are automatically deleted freeing disk space for reuse thus saving costs.

Allan Lonz
Allan Lonz
Allan Lonz, President and CEO of AdvisorVault is a veteran in the field with over 15 years experience providing data compliant solutions to the financial industry, especially for small firms. Recognizing that very few backup vendors understood the data compliance challenges of small broker-dealer firms, Allan created AdvisorVault - a remote backup company designed to provide his customers with a solution to ensure they meet all current rules from FINRA and the SEC. It includes all the hardware and software to remotely backup, archive and ensure disaster recovery of critical electronic records such as email, books and records and all other data at head office, branch offices and remote locations in accordance with rules 17a-3 and 17a-4. With Allan’s deep understanding of technology, compliance and finance he brings a unique mix of expertise that allows him to design a complete turn-key product. Priced at one small monthly fee, this "out-of-the-box " approach takes the burden off his customers shoulders and allows them to experience complete data compliance peace of mind simply and inexpensively.