A broker-dealer updates its Form CRS (Client Relationship Summary) disclosure to reflect revised fee schedules and advisory conflicts. According to SEC recordkeeping rules under Regulation Best Interest (Reg BI), for how long must the broker-dealer retain copies of each version of its Form CRS after creation or delivery?
- 6 yearsAnswer
- B3 years
- C15 days after account opening
- DUntil trade settlement of the customer's first transaction
Answer
Under SEC recordkeeping rules, broker-dealers must retain copies of each Form CRS (and all related customer delivery records) for 6 years.
The correct answer states 6 years. SEC Exchange Act Rule 17a-4(e)(10) requires broker-dealers to preserve copies of each Form CRS version and records of date of delivery to retail customers for at least 6 years, with the first 2 years in an easily accessible place.
Step-by-Step Solution
Key Concept
Form CRS Record Retention Schedule
Hints
1
Consider standard SEC book and record retention rules for primary customer-facing disclosure documents.
2
Form CRS is categorized alongside key customer account records rather than routine trade correspondence.
3
Major broker-dealer customer disclosure records must be retained for 6 years under SEC Exchange Act Rule 17a-4.
Practice More
Review the delivery trigger requirements for Form CRS when opening a new account for an existing retail customer.
Alternative Method
Memorize SEC Rule 17a-4 buckets: Routine trade correspondence and confirmations = 3 years; Account records, blotters, ledgers, and Form CRS = 6 years; Organizational documents (charters/articles) = Lifetime.
Estimated Time:45s