Pub. 10 2015-2016 Issue 6

KBS Security Officer’s By-Word One important component of the records reten- tion policy is the length of time for which each type of record will be saved. Each type has its own legal retention requirement. A retention policy will help you stay in compliance with SEC regulations, Sarbanes-Oxley and other laws that govern records retention. You should also consider your business purpose for retaining the information. Keeping records longer than the required time may seem safer, but it is not always advisable. It is best to be able to show that you have acted according to your retention policy. In addition to the length of the retention period, you must also determine in what form to store your records. It is one thing to have a record stored somewhere, and often another thing to access it readily. For example, if your bank is ever involved in litigation, you may be required to produce records that are relevant to the case. If records are stored on backup tapes, microfiche or other such devices, or buried in a filing cabinet somewhere, retrieving them may be expensive, time-consuming and downright annoying. The cost of retrieving old records prompts some banks to settle cases they could have otherwise won. Finally, establishing a method of destruction for records saved for the appropriate amount of time is vital. Destroying records in compliance with your policy, as opposed to destroying them haphazardly, can protect your bank in litigation or an investigation. Methods for destruction should match the type of records. For example, bank information stored on a computer can sometimes be destroyed by simply deleting a file, but the hard drive may need to be shred- ded or degaussed at the end of its life. Paper documents may need to be shredded. As before, you should consider both legal require- ments and your own business purpose with regard to each type of document. It is also important to know when document destruction must be suspended. If your bank reasonably anticipates litigation, it may have a duty to preserve documents that are relevant to the issues raised in the litigation. If this process sounds complicated, that is be- cause it is. Consult your bank’s CPA or attorney when designing your records retention policy. Seek legal counsel whenever you are not sure, because there is quite a bit of room for error. A consistent records retention policy eliminates the guesswork for you and your staff in organiz- ing and destroying records. It helps your bank stay efficient and avoid creating an endless maze of information that must be navigated in order to find needed information. Stay in com- pliance with the law and keep your information manageable by creating and committing to a records retention policy. Brought to you by: Chuck M. Towle and the KBS Editorial Team To help protect your bottom line, call KBS to discuss this article and other loss prevention topics or products (785) 228-0000 Access more KBS Security Officer’s By-Words at: kbsforbanks.com /resources SUBSCRIBE FOR ENHANCED KBS CONTENT: http://tinyurl.com/kbssubscribe Connect with us on social media: twitter.com/kbsforbanks linkedin.com/company/kbsforbanks Should It Stay Or Should It Go? Why You Need a Records Retention Policy March 2016 The bankers division of Berkshire Hathaway Homestate Insurance Company I f you saved every document related to your business operations, you would likely be searching through a sea of information whenever a particular item is needed. On the other hand, many bankers seem uneasy about disposing of records that may be needed in the future. So when is it time to erase, discard or otherwise destroy those old records? If you are not confident with the an- swer to that question, you should implement a records retention policy.