The US regulator has brought fraud charges against five Russians who were part of a scheme to profit from stealing corporate information and insider trading. The five defendants hacked into the systems of two US-based filing agent companies and obtained information before it was made public.
According to SEC, Ivan Yermakov hacked into the filing agents’ systems obtaining not-yet-public corporate earnings announcements stolen from those systems. He then related this information his co-defendants Vladislav Kliushin, Nikolai Rumiantcev, Mikhail Irzak, and Igor Sladkov.
The five individuals used 20 different brokerage accounts from Denmark, the United Kingdom, Cyprus and Portugal in their scheme. As a result, they generated $82 million in profits from trades, using 500 corporate earnings announcements before they were made public.
The SEC further detailed that the five defendants shared portions of their profits by funneling them through a Russian information technology company founded by Kliushin and for which Yermakov and Rumiantcev serve as directors.
Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, said:
With this action, the SEC, using its powerful analytical tools, has exposed a highly sophisticated and deceptive scheme to steal and monetize non-public corporate information. While we remain steadfast in our commitment to protect the integrity of our securities markets against bad actors no matter where they are located or what sophisticated tactics they use, we strongly encourage companies to shore up their safeguards against, and remain vigilant for cyber breaches that compromise their non-public information.
Additionally, the five defendants also have criminal charges brought against them. Kliushin was extradited from Switzerland.
Experienced writer and journalist, working in the global online trading sector, Steffy is the Editor of LeapRate. She has previous experience as a copywriter and has been with the company since January 2020. Steffy has a British and American Studies degree from St. Kliment Ochridski University in Sofia.