Is It OK To Maintain Records ONLY in Electronic Format?

By Susan Goodman CIP, IGP, CRM, CIPP posted 04-08-2010 15:56

  

I’m often asked if it is OK to eliminate paper entirely from a record-keeping process and JUST maintain electronic records. Don’t we still have to keep the paper as well as digital images? Must we create and maintain paper to satisfy record-keeping requirements? You’ve likely faced these questions too. There are many questions in addition to these when moving from a hard-copy to a digital records system, but I’ll focus on this one for this first blog post.

I’ve found (as you likely have) that professionals across disciplines - records managers, attorneys, compliance officers, information technology partners, business managers, and others - are very nervous about being responsible for approving a decision to eliminate paper. Their concern applies both to destroying source documents that have been digitized and to not creating paper in the first place (as in “born digital” records). They worry about potentially making a very, very big mistake.

There are laws, regulations, standards, guidelines, and practices that establish what constitutes trustworthy records and record-keeping systems. Some of these requirements relate to specific media and others do not. They include ISO 15489; the US Rules of Evidence and Rules of Civil Procedure, and equivalent laws in other countries; DoD 5015.2 and MoReq2 (de-facto standard specifications for electronic record-keeping systems), and others.

I believe that there are, however, two core foundational requirement documents in the United States that establish the principle underlying the answer to whether electronic records (and electronic signatures) suffice in lieu of paper. They are the E-Signature Act and UETA.

The US Electronic Signatures in Global and National Commerce Act ("ESIGN" or "the Act") facilitates the use of electronic records and signatures in interstate and foreign commerce by ensuring the validity and legal effect of contracts entered into electronically. It includes special requirements for using electronic records or signatures in consumer transactions. The Uniform Electronic Transaction Act (better known as UETA) was promulgated in the US by the National Conference of Commissioners on Uniform State Laws (NCCUSL)). It establishes the legal equivalence of electronic records and signatures with paper writings and manually-signed signatures, removing barriers to electronic commerce - with certain specified exceptions. It has been approved by American Bar Association and adopted by 47 states (see the Legislative Fact Sheet on the site for adoptions). Both acts make it very clear that if there are other laws that specifically require hard-copy, that those laws must be followed.

In my non-legal opinion, these acts establish the equivalency between digital and hard-copy records unless there is a law - or other legitimate requirement – mandating hard copy (e.g., wet signatures). Put simply, digital records are permitted instead of hard-copy unless specifically prohibited. Once this foundational premise is accepted by an organization’s Legal counsel and adopted by the firm, line-of-business attorneys, business managers, and others need only to research specific exceptions that would prohibit digital record-keeping for official records within their scope of responsibility. Again, this is my opinion as a non- attorney records and information manager, although I have found strong support for this interpretation among members of the legal community. From the perspective of developing an electronic records program, this interpretation of the law happens to make decision-making for converting to digital records where permitted more straight-forward. I’ve found that it also raises the comfort level of key decision-makers related to “going digital” when not prohibited. I’d suggest that you seek Legal Counsel for confirmation.

There are, of course, additional considerations as to whether you would want to maintain hard-copy records, such as existing contracts that require it; expectations of specific key stakeholders; and situations in which it is more cost-effective to maintain existing paper than to digitize it and destroy the source documents. And – your electronic records and record-keeping systems must, of course, be trustworthy – and admissible in court and acceptable to regulators and other stakeholders. But, these are topics for another blog post…

Your thoughts?

All the best,

Susan

The opinions expressed here represent my own and not those of Bank of America (BAC) or AIIM.



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