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International gang made millions in illegal profits by hacking press release sites

Spencer Platt/Getty Images

US authorities have charged 32 members of an international ring of hackers and financial traders. The group allegedly stole press releases from financial wire companies before they were due to be published, making millions from trades based on the information. "This international scheme is unprecedented in terms of the scope of the hacking, the number of traders, the number of securities traded and profits generated," said Mary Jo White, chair of the Securities and Exchange Commission (SEC), in a press statement.

The SEC claims that two individuals, Ivan Turchynov and Oleksandr Ieremenko, organized the scheme over the course of five years, with the pair allegedly hacking into at least two newswire services and stealing more than 150,000 press releases detailing upcoming mergers, acquisitions, and earnings announcements. This information was then passed on to traders around the world, including individuals in Russia, Ukraine, Cyprus, France, Malta, and the US. The complaint states that in return for the information Turchynov and Ieremenko received a share of the traders' profits.

traders made $511,000 in a 36-minute time window by shorting a company's stock

In one instance, traders were given access to information about a company's falling revenue projections just 36 minutes before it was due to be publicly released. In that time period they began shorting the company's stock, making $511,000 in profit when the company's share price fell following the official announcement.

Nine of the 32 individuals charged by the SEC have also been charged by the Department of Justice. The DOJ names the wire services targeted by the group as Marketwired, Newswire Association, and Business Wire, and says that traders sent hackers "shopping lists" for companies they particularly wanted information on. Five of the nine defendants named by the DOJ have already been arrested — four in Europe, one in the US — with international arrest warrants issued for the remaining four.