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At first read it seems like a normal, in fact, useful feature, but the key line is this:

"When he turns it back on, it’s back to factory defaults. All the settings, apps, and data have been erased. wtf?"

Major case of Exchange over-reaching and wiping more than just Exchange data !?



As has been said elsewhere in the comments, it overreaches because once that data hits your phone it can leak in to other applications, the phone can store attachments on it's flash storage or the SD card, etc.




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