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A Russian billionaire who hacked insider information stands trial

On Behalf of | Feb 9, 2023 | Blog, Securities Law

As you know, every business and corporation has private information that details past, present and potentially future dealings, all of which had or may have an effect on current economic trends. The disclosure of sensitive private information can potentially hurt a business’s or corporation’s operations and can lead to a loss of employee and consumer trust, loyalty and confidence. As such, businesses and corporations have to be meticulous as to how they store their private information.

In the past, much of the world’s private information was kept behind closed doors, three-feet-thick steel doors and lock and key. In other words, it wasn’t easy for people to access private information. Yet, today, more people need access to a business’s or corporation’s private information to successfully run an establishment. As a result, businesses and corporations have found that storing private information online is not only fast and easy but has greatly influenced how they operate, which requires many organizations to work with specialists to protect said data.

However, like in the days of yore when people would steal physical documents pertaining to business and corporation dealings, many people scheme to access private online information, which is what Russian billionaire hacker Vladislav Klyushin did to net a large profit through an insider trading scheme. Here’s what Klyushin did that ended up causing his arrest and extradition to the U.S. to stand trial for a $90 million scheme:

Hack-to-trade schemes are on the rise

This wasn’t a case of lucky investments and tireless research, instead, Klyushin stole insider information from companies such as Microsoft, Tesla and Sketchers by taking advantage of his Moscow-based information technology company, which had contracted with upper levels of the Russian government. Klyushin has a history of hacking and revealing private information; he has ties to a Russian military officer who hacked Hillary Clinton’s presidential campaign and revealed private emails.

Allegedly Klyushin deployed malware to collect employee information that allowed him to access hundreds of company financial disclosures. This hack-to-trade scheme allowed Klyushin to secure key financial information allowing him to make trades. His scheme has led to wire fraud and securities fraud charges.

It’s important to understand just how critical securities fraud can be. You can learn more about securities fraud and insider trading by contacting the attorneys at Ford O’Brien.

Source: WCVB, “Russian millionaire stands trial in Boston federal court for hack, insider trading scheme,” January 30, 2023