REUTERS
The hackers, working from Ukraine, infiltrated several widely used U.S. newswire systems in an unprecedented scheme combining digital-age cybercrime with old-fashioned insider trading and over five years purloined corporate press releases before publication, then selling this market-sensitive info to a league of traders on both sides of the Atlantic, according to the U.S. authorities, Bloomberg reports.
Five traders were arrested in the U.S. early Tuesday in connection with the alleged plot, which federal officials characterized as one of the most sophisticated trading rings ever seen. The supposed take: as much as $100 million. The hackers have been put on an international wanted list, but still remain at large, believed to be in Ukraine, according to Bloomberg
According to the prosecutors, the hackers phished, installed malware, stole passwords – all to gain secret access to PR Newswire, Marketwired and Business Wire, which together are used to issue thousands of corporate releases every day.
Read alsoUS data hack may be four times larger than government originally saidThe information in those press releases proved highly valuable -- so valuable that the hackers quickly built an online business around it. They were brazen enough that they created a video tutorial on how to access the pilfered data, according to prosecutors.
Business Wire and PR Newswire said they’re cooperating with prosecutors and examining their security systems. Marketwired said it also cooperated and fixed “the issue at the heart of this matter.”
Read alsoBBC: Hackers steal data of 21.5 mln people in USProsecutors described a number of lucrative trades made ahead of quarterly earnings reports, including one, in 2012, in Caterpillar Inc. shares that netted $1 million. The company’s announcement -- on a server for less than 24 hours – had been pilfered by the hackers and sold to traders. A spokeswoman for Caterpillar didn’t return a call and e-mail seeking comment.
The traders developed a “wish list” of press releases for hackers to steal, and then quickly bought and sold shares based on what they learned, according to the indictment.
The hackers used middlemen to communicate with traders, the indictment reads. As their business thrived, they sought to expand the operation by sharing tips on other fraud schemes and recruiting new traders and hackers through Internet chats and e-mails.