A hacker and his team have admitted to charges of computer hacking, press release manipulation and securities fraud that netted $30m in illegal profits.
Vadym Iermolovych, 28, pleaded guilty before US district judge Madeline Cox Arleo to conspiracy to commit wire fraud, conspiracy to commit computer hacking and aggravated identity theft.
He, and several others, conspired to break into newswires and access unpublished press releases, targeting Marketwired, PR Newswire Association LLC and Business Wire.
The US Department of Justice (DoJ) explained that the hackers used a series of targeted cyber attacks, including phishing and SQL injection attacks, to gain access to the systems.
They used this information for profit by selling it to investors, who would exploit this early access to otherwise inside information.
Three hackers, including Iermolovych, and three traders who used the information have all entered guilty pleas.
The group is said to have benefited from documents plucked from outfits including Hewlett Packard, Home Depot and VeriSign. The Securities and Exchange Commission said last year that the gang was 32 strong.
The DoJ said that it was clear from trading data that the gang was using the information to make its trades ahead of the market.
"The traders generally traded ahead of the public distribution of the stolen releases, and their trading activities shadowed the hackers' capabilities to exfiltrate stolen press releases," said the DoJ.
"In order to execute their trades before the releases were made public, the traders sometimes had to execute trades in extremely short windows of time between when the hackers illegally accessed and shared the releases and when the press releases were disseminated to the public by the newswires, usually shortly after the close of the markets.
"Frequently, all of this activity occurred on the same day. Thus, the trading data often showed a flurry of trading activity around a stolen press release just prior to its public release."
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