A wealthy Russian businessman and associates made tens of millions of dollars by cheating the stock market in an elaborate scheme that involved hacking into U.S. computer networks to steal insider information about companies such as Microsoft and Tesla, a prosecutor told jurors on Monday.\u00a0<\/p>\n
Vladislav Klyushin<\/strong>, the owner a Moscow-based information technology company with ties to the upper levels of the Russian government, is standing in trial in a Boston federal court nearly two years after he was arrested after landing in Switzerland on a private jet for a skiing trip.\u00a0<\/p>\n He\u2019s the only Russian national charged in the nearly $90 million scheme who has been arrested and extradited to the U.S.; four accused co-conspirators \u2014 including a Russian military intelligence officer\u00a0who\u2019s also been charged with meddling in the 2016 presidential election\u00a0\u2014 remain at large.\u00a0<\/p>\n Assistant U.S. Attorney Stephen Frank told jurors that the hack-to-trade scheme netted Klyushin and his associates the kind of returns \u201cactual money managers couldn\u2019t even dream about.\u201d Using stolen information about the performance of a company that would dictate its stock price, Klyushin personally turned a $2 million investment into nearly $21 million, and together, the group turned about $9 million into nearly $90 million, Frank said.\u00a0<\/p>\n \u201cIt wasn\u2019t luck. And it wasn\u2019t because of careful financial research either. The defendant cheated,\u201d Frank said.\u00a0<\/p>\n Klyushin\u2019s attorney told jurors that the government\u2019s case is filled with \u201cgaping holes\u201d and \u201cinferences.\u201d He said his client was financially successful long before he began trading stocks and he continued trading in many of the same companies even after access to the alleged insider information was shut off because the hacks were discovered.<\/p>\n \u201cThere\u2019s nothing illegal about being Russian, about having wealth, about having an IT company that contracts with the government,\u201d attorney Maksim Nemtsev said, referring to contracts with the Kremlin.\u00a0<\/p>\n Klyushin has close ties to a Russian military officer who was one of 12 Russians charged in 2018 with hacking into the Hillary Clinton presidential campaign and the Democratic Party and publishing its emails in an attempt to influence the 2016 election. Prosecutors say Ivan Ermakov,\u00a0who worked with Klyushin at the IT company, was a hacker in the alleged insider trading scheme. U.S. prosecutors have not alleged that Klyushin was involved in the election interference.<\/p>\n Klyushin and Ermakov were close friends, according to the prosecutor, who showed jurors photos of the men together and said Klyushin even bought Ermakov an apartment to live in.\u00a0<\/p>\n Klyushin, who wore headphones to listen to an interpreter as the lawyers spoke, has remained behind bars in the U.S.\u00a0since he was extradited\u00a0in December 2021<\/a>.\u00a0<\/p>\n He was arrested months earlier in Switzerland minutes after he arrived on a private jet and just before he and his party were about to board a private helicopter to whisk them to a nearby ski resort. He fought extradition to the U.S., with one appeal reaching Switzerland\u2019s highest court.\u00a0<\/p>\n Kluyshin faces charges including conspiring to obtain unauthorized access to computers and to commit wire fraud and securities fraud. The trial is expected to last a few weeks.\u00a0<\/strong><\/p>\n Klyushin ran M-13, a Moscow-based information technology company that purported to provide services to detect vulnerabilities in computer systems and counted among its clients the administration of Russian President Vladimir Putin and other government entities, according to prosecutors.\u00a0<\/p>\n Prosecutors allege that the hackers deployed malware to gather employees\u2019 usernames and passwords for two U.S.-based vendors that publicly traded companies use to make filings through the Securities and Exchange Commission. They then broke into the vendors\u2019 computer systems to get financial disclosures for hundreds of companies \u2014 including Microsoft, Tesla and Kohls, Ulta Beauty and Sketchers \u2014 before the were filed to the SEC and became public, prosecutors say.\u00a0<\/p>\n By getting a company\u2019s financial information ahead of time, the defendants were able to make trades using brokerage accounts, sometimes in their own names, based on whether a company\u2019s shares would likely rise or fall following the public disclosure of the information, prosecutors said.<\/p>\n The scheme unraveled after the SEC reported suspicious trading in the brokerage accounts of several Russian nationals to the FBI in late 2019 and the vendors later discovered they had been hacked.<\/p>\n The post Russian Millionaire on Trial in Hack, Insider Trade Scheme<\/a> appeared first on SecurityWeek<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":" A wealthy Russian businessman and associates made tens of millions of dollars by cheating the stock market in an elaborate scheme that involved hacking into U.S. computer networks to steal insider information about companies such as Microsoft and Tesla, a prosecutor told jurors on Monday.\u00a0 Vladislav Klyushin, the owner a Moscow-based information technology company with […]<\/p>\n","protected":false},"author":2,"featured_media":16763,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[27,33],"tags":[],"class_list":["post-16762","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cybercrime","category-tracking-law-enforcement"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/posts\/16762","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/comments?post=16762"}],"version-history":[{"count":0,"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/posts\/16762\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/media\/16763"}],"wp:attachment":[{"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/media?parent=16762"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/categories?post=16762"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.show.it\/en\/wp-json\/wp\/v2\/tags?post=16762"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}