IDG News Service - An Indian man has pleaded not guilty to charges that he hacked into online brokerage accounts in order to manipulate stock prices.
Jaisankar Marimuthu, 34, of Chennai, was extradited to the U.S. from Hong Kong on June 20, making him the latest to face charges in what authorities described as an international "hack, pump and dump" scheme. He entered a not guilty plea in U.S. District Court for the District of Nebraska on June 25, according to court records.
Marimuthu had already been arrested by Hong Kong police on similar charges, the U.S. Department of Justice (DoJ) said.
Another man, Thirugnanam Ramanathan, pleaded guilty to fraud charges stemming from the scheme and was sentenced to two years in prison in September. However, he was deported on Jan. 29, before serving his full sentence, according to Ian McCaleb, a DoJ spokesman.
A third man, Chockalingam Ramanathan, has been charged in the U.S. but is still at large, McCaleb said.
The three were charged two years ago for a 2006 scheme in which they allegedly hacked into online brokerages or created new accounts using stolen identities, then bought and sold stocks in order to manipulate prices to their benefit.
They hacked into more than 60 accounts in nine brokerage firms, including ETrade and TD Ameritrade, according to authorities. One firm lost more than US$2 million because of the scam.
The men allegedly drove up prices of low-volume stocks they owned, such as Acordia Therapeutics, Pacel and IGI, by buying shares with the hacked accounts, then dumping the stocks before the price dropped, authorities said. In October 2006, they also manipulated the price of near-worthless "put" options for Google, which gave buyers the option of selling Google stock for $240 (about half its value at the time), authorities said.
How Marimuthu and his associates allegedly gained access to the brokerage accounts is unclear, but court filings suggest that he may have obtained them from Internet cafés used by American and European visitors to Bangkok. Marimuthu and the others stayed at the Raja Hotel in Bangkok in 2006, prosecutors said.
Wireless networks at hotels and Internet cafés can be a security risk, especially if they are unencrypted or use the cracked Wired Equivalent Privacy (WEP) system to secure network traffic.
- Silicon Valley's 19 Coolest Places to Work
- Is Windows 8 Development Worth the Trouble?
- 8 Books Every IT Leader Should Read This Year
- 10 Hot Hadoop Startups to Watch
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
- Radicati: Cloud Business Email - Market Quadrant 2013 Google was named the top cloud business email provider in a recent report by research firm Radicati. Out of 14 key players, Google...
- Tablets in the Enterprise: A Checklist for Successful Deployment How can you enterprise manage and secure tablets in order to protect corporate data while providing access to the information and applications employees...
- Enterprise Mobility: A Checklist for Secure Containerization The advantages and disadvantages of the multiple approaches to containerization. Learn More>>
- Enterprise File Sync & Share Checklist File sync and share has changed the way people work and collaborate in today's tech-savvy world. Gone are the email roadblocks, clunky FTP...
- Live Webcast Best Practices: How to Improve Business Continuity with Virtualization VMware solutions include a range of business continuity capabilities to help ensure availability for applications across your virtualized environment. Learn More>>
- Live Webcast LIVE EVENT: 5/7, The End of Data Protection As We Know It. Introducing a Next Generation Data Protection Architecture. Traditional backup is going away, but where does this leave end-users?
- Live Webcast
Enhance Your Virtualization Infrastructure With IBM and Vmware
Date: Wednesday, May 14, 2014, 1:00 PM EDT
Virtualization technology is now expanding beyond the server compute elements to encompass networking and storage...
- LIVE EVENT: 5/7, The End of Data Protection As We Know It. Introducing a Next Generation Data Protection Architecture. Traditional backup is going away, but where does this leave end-users?
- On-demand webinar: "Mobility Mayhem: Balancing BYOD with Enterprise Security" Check out this on-demand webinar to hear Sophos senior security expert John Shier deep dive into how BYOD impacts your enterprise security strategy... All Security White Papers | Webcasts