Techno Savvy Club

Charges brought in largest US financial cyber-hacking

'Criminal conglomerate'

"The charged crimes showcase a brave new world of hacking for profit," said Preet Bharara the lead prosecutor on the case.

"It is no longer hacking merely for a quick payout, but hacking to support a diversified criminal conglomerate," he said.

Mr Aaron, 31, was a fugitive and believed to be living in Moscow.

Mr Shalon, 31, and Mr Orenstein, 40, are in custody in Israel, where their lawyers couldn't immediately be reached for comment.

The men allegedly manipulated stock prices by selling shares of companies to individuals whose contact information they had stolen. They then dumped their own shares, causing the price to fall.

The men were also charged with running an illegal payment processing business that they used to collect $18m (£11.9m) in fees.

Prosecutors claim the men hacked into competitors' systems to spy on them and then hacked into a credit card company investigating their payment processing business in order to avoid detection.

Analysis: Dave Lee, North America technology reporter

The hacking technique often involved using legitimate accounts belonging to Joshua Aaron.

Using this legitimate access, as if Mr Aaron was a normal customer, paved the way for the hackers to gain access to networks and systems containing reams of data about other customers - people who were investing in stocks.

Over the course of several years, they stole personal data on more than 100m people.

Investigators said the hackers used the personal details to send out information to bosses' email addresses, promoting certain stocks that hackers had bought cheap. The price would rise, and the hackers will then sell off their now very valuable shares.

It's a technique known as "pump and dump".

Separate charges have also been brought against a Florida man, Anthony Murgio, who operated a unlicensed digital currency service and had previously been linked to the breach at JPMorgan.

The US Securities and Exchange Commission had already filed civil charges related to securities fraud against Mr Shalon, Mr Aaron and Mr Orenstein.

At Tuesday's press conference, US Attorney General Loretta Lynch thanked the institutions involved for coming forward to report the hacking allowing prosecutors to pursue criminal charges.

"In an age when enormous quantities of vital information are stored in digital format on potentially vulnerable Internet-connected devices, public-private partnerships and information-sharing are more critical than ever," Ms Lynch said.

Credits: BBC.COM