Morgan Stanley Agrees To $60M Settlement In Data Security Lawsuit

NEW YORK, NY — Morgan Stanley agreed to pay a $60 million settlement in a lawsuit brought by customers who accuse the bank of failing to secure their personal information before selling old technology to third parties.

The preliminary settlement was filed in the U.S. District Court Southern District of New York on Friday, according to court documents. It will require the approval of U.S. District Judge Analisa Torres.

The settlement was first reported by Reuters.

Plaintiffs are accusing Morgan Stanley of failing to delete their information from two wealth management data centers before they were sold to a third party in 2016. Morgan Stanley also is accused of a similar incident in 2019, but it was able to recover the equipment, court documents show.

The bank denied wrongdoing in the settlement, but customers would receive two years of fraud insurance and could make a claim for $10,000. Morgan Stanley further outlined upgrades to its security practices in the settlement.