Does your financial advisor help you safeguard your documents as they should?

Momentum Consult’s compliance division looks at the vulnerabilities when it comes to document storage and the risks of cybercrime.

You’ve found a financial advisor with whom you’re willing to trust with your finances. But what about the storage of your personal documents? Many people don’t realise how important the correct storage of personal documentation is. When deciding on a financial advisor, you should ensure that they can offer you the right advice on the storage of your personal documents.

It is true that in terms of legislation, financial services companies are obliged to have appropriate systems and procedures in place for the storage and safeguarding of your records. However, in today’s world there is always a threat to storage practices…enter cybercrime. In a country where law-breaking is so high, it is not surprising that criminals have turned to the internet, so much so that cybercrime – according to the PWC Global Economic Crime Survey 2016-- has become the second most reported crime in South Africa. The South African Banking Risk Information Centre (SABRIC) recently reported that our nation is losing more than R1-billion each year to cybercrime – a number that has increased by 30% since 2013.

Fortunately, as the most regulated industry in the world, Momentum Consult and other financial institutions go to every length possible to adhere to very specific document storage requirements. This is done to mitigate risks to their business and their clients. These requirements – that sometimes seem tedious – offer protection against your chosen financial service provider being hacked, phished, or spammed.

The good news is that financial services organisations have a back-up of all your important files as a legislative requirement. These files are ideally saved on a web-based program or the “Cloud”, to provide for documents to be retrieved from anywhere and at any time. It is also a requirement that back-ups are made of all electronic records and kept off-site. These records include FICA-related documents everything pertaining to the advice process, your correspondence with the client services team and even phone calls.

Based on the aforementioned legislative requirements, Momentum Consult acquired two internet-based programs, Elite Wealth and Brolink, for the purpose of financial planning and

record keeping. Elite Wealth supports investment and risk planning, whilst Brolink supports short-term insurance-related financial services.

Both Brolink and Elite Wealth meet the requirements of having appropriate systems to record all verbal and written communications relating to a financial service rendered to you as a client; to store and retrieve such records, and any other material documentation relating to you or the financial services rendered to you; and keeping the documents safe from destruction.

Furthermore, these systems meet the requirements of keeping the records for a period of five years after termination of the product or the financial service, and keeping the records in appropriate electronic formats which are accessible and readily deducible to written or printed form.

It is the responsibility of your financial adviser to ensure that all records pertaining to the financial services rendered by him/her are stored on the relevant system/s.

Your financial adviser is prohibited from disclosing the confidential information acquired from you to any third party without your written consent, unless the information is required in the public interest or under any law.

The Financial Advisory and Intermediary Services Act, the General Code of Conduct for Authorised FSPs and the Financial Intelligence Centre Act govern what your financial services company adheres to when keeping track of clients’ data storage. They, in turn, make sure their computer systems are uncompromised and protect you as far as possible.