* Why all organizations need to preserve e-mail
Last week, five of the largest furniture manufacturers in North Carolina were fined a total of more than $8.2 million by the U.S. government for their failure to preserve e-mail records according to statutory requirements. Also last week, a senior manager at one of the largest retailers in the Northeast was found guilty of obstruction of justice and witness tampering after he told his staff to “clean up” their files by deleting old e-mail messages that might have been harmful to the company.
Well, not really. The furniture manufacturers are really five large Wall Street brokerage houses that were fined $1.65 million each in December 2002 for their failure to preserve e-mails for the statutory periods required by the Securities and Exchange Commission, and the large retailer’s senior manager is really Frank Quattrone, who was an investment banker for a large brokerage house.
My point is that financial services firms are widely perceived to be the only “regulated” companies when it comes to e-mail preservation and that everyone else is perceived to be more or less free to do what they want, deleting all e-mail on a 30- or 60-day purge cycle, for example.
That is simply not the case – and the hypothetical examples I outlined above could easily become reality. As I’ve discussed in this newsletter before, all organizations, regardless of size, should preserve e-mail. Here are two reasons why:
* First, it’s the law. There are a number of statutes that apply to virtually all organizations, not just broker-dealers. Just like you’re supposed to keep tax records for the minimum periods prescribed by the Internal Revenue Service, keep your e-mail for the minimum periods prescribed by the multitude of requirements for data retention.
* Second, e-mail is never really deleted – someone is bound to have a copy of corporate e-mail on a file server, local hard disk, home computer, laptop, keychain USB device, PDA, etc. Although an e-mail message may be incriminating, it’s at least better to know what you’re up against when defending yourself than to be surprised by a message you thought had been deleted. Plus, it’s better to preserve e-mail so that at least you have the context that might explain a potentially incriminating statement; that offhand comment from your CEO about crushing the competition might actually have been a joke, and having access to the entire original e-mail thread could prove that.
I’d like to hear your thoughts on the whys and why nots of preserving e-mail – please drop me a line at mailto:michael@ostermanresearch.com
