Penalty Amount
$1,270,000
Consumers Affected
3,370,000
New Jersey Attorney General Matthew Platkin announced a multistate settlement where Morgan Stanley will pay $1.27 million to NJ over data security incidents that compromised personal information of over 755,000 NJ residents and millions nationwide. The incidents involved improper decommissioning of devices and a software flaw, leading to unauthorized access. The settlement requires Morgan Stanley to strengthen its data security and disposal procedures.
Morgan Stanley must pay $1.27 million to New Jersey, maintain a comprehensive information security program, implement an incident response plan, regularly inventory hardware, maintain vendor inventories and risk ratings, require vendors to securely dispose of data and document it, and ensure subcontractors comply with security requirements.
In-house legal teams should review all agreements involving personal information processing, including vendor contracts, customer service agreements, employee data policies, and data processing addendums. Key clauses to assess are data security obligations, device and media disposal procedures, software vulnerability management, breach notification requirements, and data retention schedules. Based on the settlement, contracts may need amendments to enforce stricter security standards, mandate secure decommissioning of devices (e.g., data wiping or destruction), require regular security audits and vulnerability assessments, enhance breach notification timelines and scope, and ensure compliance with multistate data protection laws to mitigate risks from improper disposal and software flaws.
Entity
Morgan Stanley Smith Barney, LLC
Also known as: Morgan Stanley
Industry
Financial ServicesOfficial Press Release
https://www.njoag.gov/ag-platkin-new-jersey-to-receive-1-27-million-in-multistate-settlement-with-morgan-stanley-over-data-security-incidents-that-compromised-personal-information-of-millions-of-individuals-nationwide/
2023 1116 Morgan Stanley Assurance of Voluntary Compliance
https://www.nj.gov/oag/newsreleases23/2023-1116_Morgan-Stanley-Assurance-of-Voluntary-Compliance.pdf
New Jersey Attorney General Enforcement Page
https://www.njoag.gov/about/divisions-and-offices/division-of-consumer-affairs/
"Morgan Stanley Smith Barney, LLC (“Morgan Stanley”)"
"New Jersey is to receive approximately $1.27 million"
"the data security incidents resulted in unauthorized third parties having the ability to access devices containing customers’ personal information"
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