A pair of Ukrainian nationals were indicted last week in Federal court on charges that they were part of a grand plot to break into the computer system of the Securities and Exchange Commission (SEC) and sell information they gleaned while inside.
The two men, one 27-year-old and one 26-year-old and both of Kiev, were charged in the District of New Jersey on counts of securities fraud conspiracy, wire fraud conspiracy, computer fraud conspiracy, wire fraud, and computer fraud. In addition, the SEC filed a civil complaint against the men on those same allegations.
Per federal investigators, the two gained illicit access to the SEC's Electronic Data Gathering, Analysis and Retrieval (EDGAR) system and downloaded thousands of files consisting of legally-mandated reports the SEC requires of publicly-traded companies. With these files in hand, the pair sold the information on the black market as well as acting on the information themselves before the contents in the reports became public.
Prosecutors say the break-ins occurred between February 2016 and March 2017 and included gaining access to test filings, which often contain information not meant for release to the public at that time. The test filings, once stolen, were then sent to traders in Eastern Europe, who allegedly made significant purchases, held the stocks through the public announcement of information, then sold them at a tremendous profit.
If convicted, the pair is facing up to two decades in prison on the wire fraud charges, plus a $250,000 fine or twice the gain or loss from the offense, while the securities fraud conspiracy, computer fraud conspiracy, and substantive computer fraud counts may result in a prison sentence of five years plus a $250,000 fine or twice the gain or loss from the offense.
The Law Offices of Bjorn Brunvand have been representing people charged with capital murder, felony drug charges, drunk driving, government fraud, and white-collar crimes for over a quarter century. Contact our office today to discuss your Tampa Bay-area state or federal charges.