Now Reading
Feds To Charge Hackers Who Stole Merger Info

Feds To Charge Hackers Who Stole Merger Info

by Elliot MarasAugust 11, 2015

homeland securityU.S. authorities are preparing to charge a group of traders and computer hackers for scheming to get early access to press releases about mergers and acquisitions and trade on them before they became public, The Wall Street Journal reported, citing unnamed sources familiar with the matter. The Securities and Exchange Commission (SEC) is also expected to unveil related civil charges as early as Tuesday.

Federal prosecutors in Brooklyn and New Jersey will announce charges against more than a half-dozen people with securities fraud and other charges. Officials believe the scheme netted tens of millions of dollars in illicit profits.

Financial Crimes Go Cyber

The case deFBImonstrates the growing connection between cyber theft and more traditional financial crimes, sources said.

The hackers allegedly infiltrated news-wire services that publish press releases about mergers and acquisitions and obtained information about not-yet-announced deals, the sources said. The traders then used the information to make early trades, exploiting the window of time between releases being uploaded into the system and the public announcement of the information.

The report said the identities of the individuals likely to be charged and the deals they traded on were not available.

Insight Coming On Online Black Market

The charges in the Brooklyn and New Jersey U.S. attorneys offices are expected to reveal information about the complex online black market.
U.S. officials have increasingly warned that criminals are meeting in dark corners of the web to exchange criminal skill sets such as hacking and securities fraud.

Even though cyberattacks have targeted information that could help investors gain an illegal advantage, former U.S. officials and security experts have rarely seen evidence of hacked information being used in suspicious trading.

Also read: Illegal Marketplace and Cybercrime Forum Darkode Is Back Online

Cross Agency Investigation


Chairman White

Sources said the charges stem from a cross-agency investigation involving at least six federal agencies. Jeh Johnson, U.S. secretary of homeland security, and SEC Chairman Mary Jo White will travel to New Jersey to announce the charges, sources said. In addition, Joseph Clancy, director of the Secret Service, and Diego Rodriguez, assistant director in charge of the New York field office of the FBI, are also expected to be present, along with Kelly Currie, acting Brooklyn U.S. attorney, and Paul Fishman, New Jersey U.S. attorney.

The Department of Homeland Security, SEC, FBI, Secret Service and the offices of the U.S. Attorneys in Brooklyn and New Jersey all declined to comment.

Images from Shutterstock.

Advertised sites are not endorsed by us. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
What's your reaction?
Love it
Hate it
  • Monk฿TC

    good for the nerds – too bad the real criminals have more power… woo woo – what about Hedge Funds and all their paying moles and the real insider trading going on daily on wall street – sure take it out on the fucking nerds, hackers and computer guys – assholes – get a real job – go after wall street. oh wait – those are your buddies…