Hackers accused of making $100M by peeking at press releases
NEWARK, N.J. – An international web of hackers and traders made $100 million on Wall Street by stealing a look at corporate press releases before they went out and then trading on that information ahead of the pack, federal authorities charged Tuesday.
Authorities said it was the biggest scheme of its kind ever prosecuted, and one that demonstrated another alarming vulnerability in the financial system in this age of increasingly sophisticated cybercrime.
In a 21st-century twist on insider trading, the hackers broke into the computers of some of the biggest business newswire services, which put out earnings announcements and other press releases for a multitude of corporations.
Nine people in the U.S. and Ukraine were indicted on federal criminal charges, including securities fraud, computer fraud and conspiracy
The case “illustrates the risks posed for our global markets by today’s sophisticated hackers,” SEC chief Mary Jo White said. “Today’s international case is unprecedented in terms of the scope of the hacking at issue, the number of traders involved, the number of securities unlawfully traded and the amount of profits generated.”