- Fund Regulation
- Retirement Security
- Trading & Markets
- Fund Governance
- ICI Comment Letters
Institute Comments on SEC Electronic Recordkeeping Proposal
Washington, DC, April 20, 2001 - The Institute filed a comment letter on the SEC’s proposal to amend Rule 31a-2 under the Investment Company Act of 1940 and Rule 204-2 under the Investment Advisers Act of 1940, to expand the circumstances under which funds and advisers may use electronic storage media to maintain and preserve records.
The letter generally supports the Commission’s proposal, but makes several technical recommendations to make the rules more workable and to ensure consistency in the recordkeeping process.
The Institute’s letter points out that the Commission’s proposal does not address recordkeeping requirements contained in other rules under the Investment Company Act, such as Rule 2a-7 (money market funds) and Rule 17j-1 (codes of ethics). The letter cautions that if the Commission intends its proposed performance standards under Rules 31a-2 and Rule 204-2 to be the "exclusive means by which funds and advisers could comply with E-SIGN’s standards of accuracy and accessibility," then it is all the more imperative that it clarify the status of such other recordkeeping requirements.
The letter also reminds the Commission of its previously proposed amendments (never adopted) to Rule 17Ad-7 under the Securities Exchange Act of 1934, which would have allowed registered transfer agents to use micrographic or electronic storage media to produce and preserve required records. Since E-SIGN will permit transfer agents to use electronic storage media as of June 1, 2001, the letter encourages the Commission to clarify what standards will apply to such recordkeeping, adding that any such standards should be consistent with those for fund and adviser records.