Web site abuse: Morgan Stanley in trouble
Thursday, 13 September , 2007, 10:15
Boston: Massachusetts Secretary of State William F. Galvin filed a civil complaint against Morgan Stanley and two of its Boston employees, accusing them of "dishonest" practices for allegedly using a job-search Internet site to find sales prospects.
The complaint says the company tapped into CareerBuilder.com for resumes, then cold-called people in violation of state and federal do-not-call laws and regulations.
In a statement responding to the complaint, Morgan Stanley said the charges "involve an isolated instance in one office involving a single financial advisor," and added that the company "takes its do-not-call obligations extremely seriously, has systems in place to prevent abuse, and trains its personnel to abide by all regulations."
The complaint says a Morgan Stanley financial advisor, Arlen Jay Fox, accessed more than a thousand resumes on CareerBuilder.com for the purpose of sales prospecting between August 2005 and December 2006.
The alleged use violated Morgan Stanley's contract with CareerBuilder, which limited the financial-services company's access and use of the resume information for hiring purposes only, the complaint says.
The complaint says "the resumes were chock-full of valuable information, such as employment history (suggesting potential sources of 401k transfers), recent salary levels and vital contact information, such as cell phone telephone numbers, that might not otherwise be published."
The complaint says the alleged cold calls to hundreds of CareerBuilder customers also violated national and state do-not-call laws.
According to Galvin's office, an assistant branch manager in the Boston office allowed Fox to use a management password to access resumes on CareerBuilder.
The complaint also names Michael Rhodes, a Boston branch manager, alleging that the branch tried to conceal the origin of the cold calls by keeping its "caller ID information hidden from the general public" in violation of New York Stock Exchange rules and regulations.
The Massachusetts securities regulators say the "over-emphasis" on a high number of sales calls came from Morgan Stanley at the national level. The company urged new financial advisers and trainers "to make a minimum of 100-200 'dials' per day to prospects," the complaint says.
