https://www.microsoft.com/en-us/privacystatement/default.asp...
"Finally, we will access, disclose and preserve personal data, including your content (such as the content of your emails, other private communications or files in private folders), when we have a good faith belief that doing so is necessary to: 1.comply with applicable law or respond to valid legal process, including from law enforcement or other government agencies; 2.protect our customers, for example to prevent spam or attempts to defraud users of the services, or to help prevent the loss of life or serious injury of anyone; 3.operate and maintain the security of our services, including to prevent or stop an attack on our computer systems or networks; or 4.protect the rights or property of Microsoft, including enforcing the terms governing the use of the services - however, if we receive information indicating that someone is using our services to traffic in stolen intellectual or physical property of Microsoft, we will not inspect a customer's private content ourselves, but we may refer the matter to law enforcement."
Definitely close your accounts if you want to protect your data, no fault there :) But make sure you know that this article doesn't actually tell an accurate picture.