Bloomberg blackmail hacker suspects held

Two alleged hackers from the former Soviet state of Kazakhstan have been arrested in connection with a reported blackmail attempt against financial information service provider Bloomberg.

According to reports in the New York Times, a man calling himself Alex, who said he had obtained passwords of senior Bloomberg employees, contacted chief executive Michael Bloomberg in March.

He proposed that New York-based Bloomberg pay him $200,000 for pointing out the security breach in its IT systems, said the report. After an exchange of messages and a demonstration that he had indeed accessed the company's system, Bloomberg under guidance of the FBI deposited $200,000 at a Deutsche Bank office in London and arranged to meet the alleged hacker last week.

Emails included in the exchange are reported by the paper to reveal that Alex, who claimed to be "honest" and "well intentioned", said he would destroy the material - computer screen printouts with confidential corporate files and senior executives' credit card details - once the money had been received.

One email said, according to the report, that this confidential material would be distributed to clients "in the case of non-payment" - a potential major embarrassment for a financial information company such as Bloomberg.

After a meeting at a London hotel last Thursday, police arrested Oleg Zezov, 27, and Igor Yarimaka, 37, charging them with unauthorised computer intrusion. If extradited to the US, where the servers were breached, and convicted on all charges, the pair could be jailed for up to 20 years.