Ethics - Records retention

Hi everyone, I have a question regarding Record Retention (Standard VI A).

In the CFA Institute book, I found “Records created as part of a member’s or candidate’s professional activity on behalf of his/her employer are property of the firm. When a member or candidate leaves the firm to seek another employment, the member or candidate cannot take the property of the firm (…) to the new employer without the express consent of the previous employer”.

What about an analyst that gets a new employment and takes records with him (not to the new employer, but just for him/herself) in order to comply with minimum retention period required by the law, the retention period suggested by CFAI or as a backup? Let’s say that the firm is subsequently part of an investigation and the former employee has to give evidence, testify or explain the reasons behind his old research. How can he do it if he hasn’t taken with him a copy of the records on which his research was based?

Thank you

You can’t take out any info from the company unless its express permission. You can say it is for educational purposes, but depends on the company.

The case you propose is not sufficient, once you leave the company all the info must be deleted from your personal computer or other devices you carried info. You can’t also take info of clients list, formulas or patented procedures (i.e original trade algorithms).

If in the future you are called to testify about your past performance on that company, that company is obliged to present such information you participated to create.

Also, this is wrong. It is the company responsibility to save records of info by law, not the analyst’s.

Thanks for your reply @Harrogath

I am not sure though that records retention requirements must be followed only by the firm. I believe those requirements must be followed by members and candidates too.

“Local regulators often impose requirements on members, candidates, and their firms related to record retention that must be followed. Firms may also implement policies detailing the applicable time frame for retaining research and client communication records. Fulfilling such regulatory and firm requirements satisfies the requirements of Standard V©. In the absence of regulatory guidance or firm policies, CFA Institute recommends maintaining records for at least seven years.”

If your local regulator imposes you an obligation to retain information as an individual employee, then comply. Those requirements by regulator must be quite specific (exactly what kind of info you must retain).

On the other hand, I’m talking about that you cannot take out sensitive info of your former employer like model formulas, algorithms, client lists, other employees names or personal data, etc.

Hope it is clearer now.