Ex-Morgan Stanley adviser spared U.S. prison term for taking data
By Nate Raymond
NEW YORK, Dec 22 (Reuters) - A former Morgan Stanley financial adviser was spared prison on Tuesday for illegally accessing the bank's computers and taking home client data that his lawyers say Russian hackers then obtained and posted online.
U.S. prosecutors had sought a sentence of over three years in prison for Galen Marsh, who worked in Morgan Stanley's private wealth management division and was fired last January in connection with the data breach.
U.S. District Judge Kevin Duffy in Manhattan instead sentenced Marsh to three years of probation and ordered him to pay Morgan Stanley $600,000 in restitution in light of his guilty plea in September to one count of unauthorized access to a computer.
But the judge warned Marsh that if he violated the terms of his probation, "I will hit you with everything possible and make sure you spend your time in the worst place I can find.
"God forbid you screw up once," he added.
Prosecutors said Marsh, 31, from 2011 and 2014 obtained confidential information for approximately 730,000 accounts without permission and uploaded the data to a personal server at his home in New Jersey.
Prosecutors said Marsh used the data for his personal advantage, and said that at the time, he was in talks about landing a new job with two Morgan Stanley competitors.
In December 2014, Morgan Stanley discovered information for thousands of clients had been published online, prompting the bank to investigate and fire Marsh in January.
While Marsh was linked to the data, authorities determined that his server had been compromised in October 2014, according to court records.
In court, Marsh's lawyer, Robert Gottlieb, said Morgan Stanley informed him that Russian hackers were suspected to be involved.
He chastised the bank for allowing a "false story" that Marsh himself was responsible for posting the data online to flourish in the media initially after the breach.
"He did not disclose it to anyone," Gottlieb said.
Morgan Stanley declined to comment. It has said information about 900 client accounts was briefly posted online and that up to 10 percent of its approximately 3.5 million wealth management clients were affected.
No clients lost money due to the breach, the bank has said.
In court, Marsh apologized to Morgan Stanley, its clients and his family.
"I know what I did was wrong," he said. "I'll feel ashamed for the rest of my life." (Reporting by Nate Raymond in New York; Editing by Dan Grebler)
