Matt Levine has talked a few times about the wild scope increase of records retention in finance over the past century or so in Money Stuff. Not exactly the same as a legal hold, but analogous for similar reasons (recording everything has become cheaper).
> We have talked before about the SEC’s probe into how the employees of big banks discussed their work in text messages and chat apps like WhatsApp on their personal cell phones. The SEC has collected big fines from the biggest banks because, it has said, these chats violated the SEC’s recordkeeping requirements.
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> From the perspective of the banks, I have argued, this is a novel expansion of the SEC’s authority. When the SEC created its rules on recordkeeping, it required banks to retain copies of their “inter-office memoranda,” but it was 1948 and those memoranda were produced with carbon paper; they were formal business records memorializing serious policies. In the 2020s, WhatsApp chats are, in large part, substitutes not for formal memoranda but for talking to someone in person. When I was a banker, I have written, “There were some mornings when I sent more than 100 inter-office memoranda, though like 20 of them would be ‘lol’ or ‘fml.’” In 1948, the SEC would not have dreamed of demanding a searchable archive of all of the informal chats held at a brokerage: That was not technologically feasible, and also did not seem to be the point of its rules. In 2022, it was feasible, and the SEC did demand it, and when the brokers were missing some chats they paid a billion dollars in fines.
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> It really is wild that the SEC’s official position is now that it is illegal to “use unofficial communications to do things like cut deals, win clients or make trades.” “Conduct their communications about business matters within only official channels”! Imagine if that was really the rule! You can’t have lunch with a client and talk about business, or have beers with your colleagues and gripe about work, because that does not create a searchable archive for the SEC to review.
> Of course the SEC does not entirely mean this. Yet. But in like five years, technology — and the SEC’s interpretation of the rules — will have advanced to the point that banks will get fined if their bankers talk about business with clients on the golf course.
https://www.bloomberg.com/opinion/articles/2023-02-02/the-se...