An alliance of mainly U.S.-based stock traders and computer hackers in Ukraine made as much as $100 million in illegal profits over five years after stealing confidential corporate press releases, U.S. authorities said on Tuesday.
Prosecutors announced charges against nine people in an insider-trading case that marks the first time criminal charges have been brought for a securities fraud scheme involving hacked inside information, in this instance 150,000 press releases from distributors Business Wire, Marketwired and PR Newswire.
“This is the story of a traditional securities fraud scheme with a twist – one that employed a contemporary approach to a conventional crime,” FBI Assistant Director-in-Charge Diego Rodriguez said at a news conference.
Prosecutors said Ukraine-based hackers improperly accessed press releases before the distributors planned to release them to the public. The traders gave the hackers “shopping lists” of releases, prosecutors said.