IG raps SEC records management

The Securities and Exchange Commission’s records are in disorder, the agency's Inspector General has found. However, SEC officials argue that the audit's findings focus on older records and thus discount the agency’s improvements in recent years.

In their report, the auditors described several problems. They determined employees often do not follow records management procedures and many workers are confused about their responsibilities. Some offices have no points-of-contact in charge of records management. Employees did not know how long to keep documents or when and what documents should be destroyed. The SEC’s Office of Records Management Services (ORMS) even has a 10-year backlog of records that are eligible for destruction, according to the report, released Sept. 30.

Read the IG Report.

Further, the audit revealed the SEC failed to comply with vital records management regulations from the National Archive and Records Administration. Regulations require files to be reviewed and rotated at least annually so the latest version is available. Moreover, officials have not defined what they consider a vital record. The problems tie back to a lack of an active staff assistance program at the SEC, and that other oversight offices have not done their check-ups.

In the report, the IG made 12 recommendations for the SEC. Among them: ORMS should make regular agency-wide staff assistance visits with the offices and divisions. The office should create a training program. Offices and divisions need to appoint points-of-contact to handle record-management issues.

Barry Walters, director of the SEC’s Office of Support Operations, agreed with the recommendations, but he added that the report put the SEC’s improvements in a poor light.

“The scope of the audit and the recommendations combine to highlight records issues existing prior to 2008, and thus significantly diminish the accomplishments of the Office of Records Management Services since 2008,” Walters wrote. The SEC first appointed an archivist in 2007.

The scope of the audit covered 2008 to 2010 and 2011.

From 2007 to 2011, ORMS has conducted 383 meetings with employees from all SEC divisions and commission offices to talk about records management. It has made records assessment visits to the seven of the commission’s 11 regional offices. Officials have conducted 52 training sessions, and, since 2010, have briefed approximately 1,500 new SEC staff on their record-keeping responsibilities. It also established a training program in 2011.

“These are just some of the many noteworthy ORMS achievements that have occurred in the past five years,” Walters wrote.

However, the IG responded that Walters’ assertion that the report diminishes the work of the SEC is “not factual.” The report is based on factual evidence and the auditors’ observations made during their reviews.