The mistake? Get rid of old computers without erasing the hard drives.
In an episode described by the Securities and Exchange Commission, Morgan Stanley hired a removals company — which had “no experience or expertise” in data destruction — to dismantle thousands of hard drives and servers containing customer data.
That company later sold thousands of those devices, some of which contain personally identifiable information, to a third party. Eventually, the devices, still loaded with sensitive data, ended up on an auction site.
The SEC didn’t mince words in explaining Morgan Stanley’s missteps.
The “failures in this case are astonishing,” Gurbir Grewal, director of the SEC’s enforcement division, said in a statement. “If this sensitive information is not properly secured, it could fall into the wrong hands and have disastrous consequences for investors.”
So yeah, it was pretty stupid. But it is important to note that the SEC is not claiming anything criminal did happen, just that it could have.
Morgan Stanley agreed to pay the fine without admitting or denying the findings in the settlement.
“We have previously notified relevant customers of these matters, which occurred several years ago, and have not discovered any unauthorized access or misuse of personal customer information,” Morgan Stanley said in a statement.
Another way of saying that is, we got lucky and no bad actors managed to exploit the data that we carelessly released to the public, as far as we know.
Free advice next time, everyone: call tech support! We can all be luddites, guys – it’s nothing to be ashamed of.
NUMBER OF THE DAY: 45,000
We are three quarters of 2022 and the hangover of 2020 is still limping on the auto industry.
Here’s the deal: Ford is now stuck with a whopping 45,000 big pickups and SUVs it can’t finish because, well, it doesn’t have all the parts… does it sound familiar? It should, as it has been going on for over two years.
The company warned late Monday that shortages and rising supplies prices will cost it an additional $1 billion this quarter. Shares of Ford fell 12% on Tuesday.
The $25 trillion dollar question of the year was a variation of a) are we already in a recession? and b) how bad will it be?
We have a For real fun time trying to explain why the US isn’t technically in a recession right now, even after two consecutive quarters of negative growth. ICYMI: That oft-cited guideline has some caveats and isn’t a hard and fast rule. And looking at the current job market, with near-record low unemployment and resilient consumer spending, wouldn’t logically call it a recession.
That doesn’t mean the fears are gone.
Take FedEx, which led a massive sell-off late last week as it lowered its guidelines and warned of a global downturn. It’s not alone. Earlier this month, the CEO of luxury retailer RH (aka Restoration Hardware) said that “anyone who thinks we’re not in a recession is crazy” and added that the housing market is in a downward spiral that is “just just started”. Best Buy’s CFO avoided the R-word, but used the kind of business jargon — “current macro-environmental trends may be even more challenging” — that sounds like an alarm bell.
Chip equipment leader Applied Materials had a number of other euphemisms to scare investors last month, saying some of its customers are in delay mode “because macro uncertainty and weakness in consumer electronics and PCs are causing these companies to delay some orders.”
Analysts and companies are already lowering their outlook, raising the prospect that the third quarter could be the worst quarter for earnings since 2020, when the pandemic shut down the economy.
So yeah, it’s not great. But it’s not bad at 2008 levels. And there’s one potential bright spot, explains Paul. The housing market appears to be slowing, rather than crashing a la the subprime crisis of 07/08.