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Editor: Eric C. Chaffee
Univ. of Toledo College of Law

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Tuesday, February 19, 2013

FINRA Fines ING Affiliates $1.2 Million for Email Retention and Review Violations

FINRA has fined five affiliates of ING $1.2 million for failing to retain or review millions of emails for periods ranging from two months to more than six years.  FINRA also ordered the firms to conduct a comprehensive review of their systems for the capture, retention and review of email, and to subsequently certify that they have established procedures reasonably designed to address and correct the violations.

FINRA found that the firms failed to properly configure hundreds of employee email accounts to ensure that the emails sent to and from those accounts were retained and reviewed at various times between 2004 and 2012. In addition, four of the firms failed to set up systems to retain certain types of emails, such as emails using alternative email addresses, emails sent to distribution lists, emails received as blind carbon copies, encrypted emails and "cloud" email (emails sent through third-party systems). As a result of these failures, emails sent to and from hundreds of employees and associated persons were not retained; and because the emails were not retained, they were not subject to supervisory review.

In addition, four of the firms failed to review millions of emails that the firms' email review software had flagged for supervisory review. At various times between January 2005 and May 2011, nearly six million emails flagged for review went unreviewed by supervisory principals because the email review software was not properly configured.

http://lawprofessors.typepad.com/securities/2013/02/finra-fines-ing-affiliates-12-million-for-email-retention-and-review-violations.html

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