Retention
Retention Period
The mandatory retention period for client files by the firm, brokerage, company, or independent representative can vary based on the nature of the files. The representative must therefore consult the applicable regulations for the field in which he works to determine this period.
Insurance and financial planning
Mutual funds and scholarship plans
Retention Method
Remember that, during the retention period, the firm, brokerage, company, or independent representative must take all necessary measures to prevent the loss, theft, destruction, and falsification of data, whether it is kept electronically or otherwise.
Also, the firm, brokerage, company, or independent representative must take measures that allow him to find a client file within a reasonable amount of time, especially when a legally-authorized person would like to see it. This requires an appropriate filing and tracking system.
As a general rule, files should be kept by the firm, brokerage, company or independent representative in a secure location. This location should not be easily accessible, except by authorized people. In this regard, a firm or independent partnership must ensure that its representatives can only access the information necessary for conducting their business.
A good way to fulfil this obligation is to keep files in locked cabinets within a locked room. However, any other safe method ensuring the same result would also be acceptable.
As for the tracking requirement, the representative could use a separate cabinet for each file type, along with appropriate coding, to quickly find files, though other coding systems may also be effective.
The same rule for hard copy files applies to electronic files, in the sense that the retention method must be safe.
This assumes that the firm, brokerage, company, or independent representative keeps information in a way that no person can access it, except for authorized people.
Additionally, this information must not be able to be involuntarily destroyed or falsified. The section Using information technology provides more details on this topic.
As for the tracking requirement, it requires the use of an effective categorization method for each file or record to be tracked within a reasonable amount of time.
File disposal
It is not possible or even desirable to keep all of a client’s files indefinitely. After the mandatory file retention period and the additional period if files need to be kept for risk management purposes, the firm, brokerage, company, or independent representative can dispose of them while adhering to certain conditions.
Warning! A process that guarantees the confidentiality and security of the information contained in the files must be used.
Shredding is the best method to dispose of confidential documents. When they cannot be shredded, the firm, brokerage, company, or independent representative must store them in a locked location and provide them to a company specializing in paper recovery that has the necessary infrastructure to dispose of the documents with no risk of information leakage. The company must agree to respect the confidential nature of the documents provided to them.
The Commission d’accès à l’information du Québec website has more information about safe disposal of documents containing personal information.
Tips
Keeping files longer may be very useful
It may be wise for the firm, brokerage, company, or independent representative to keep files, books, and records longer than the minimum required period.
Remember that these files serve as the history of relationships with clients. They could therefore be a significant means of defence for the representative in the event of a conflict, and even more so because proceedings before the CSF disciplinary committee are imprescriptible, meaning that they have no time limit. These files may be kept for longer for risk management purposes and to allow an advisor to defend themselves in the case of a disciplinary complaint, a civil claim or other. In that case, an additional protection measure must be implemented to ensure files containing confidential information are protected at a high level. Obviously, these files should not be kept indefinitely to limit the risks in the case of a privacy breach. Retention and destruction procedures and timelines must also be implemented to ensure the protection of confidential information contained in client files.
Using a digital format allows all client files to be kept for long periods while also saving space.
Proper security measures must be taken to ensure protection of the personal information stored. These measures must be reasonable given, in particular, the sensitivity, purpose, quantity, allocation, and format of personal information.
Inactive files, for example, could be categorized separately from active files, and they could have more restricted access.
Stricter rules may be applied
Regulations governing file and record retention establish minimal rules.
A firm, brokerage, company, or independent representative may therefore apply stricter rules. A representative working for a firm or independent partnership must be aware of the requirements set by this firm or company regarding keeping and retaining files and records.
Working with a specialist…
It may be wise to work with a specialist in document management, an archivist, or information management software.