![]() ![]() ![]() The SEC said the Chinese hackers were caught using "enhanced trading surveillance and analysis capabilities" developed by the agency in the past few years. Related: Expedia IT guy made $300,000 by hacking own execs The defendants sold all of their Altera stock several weeks later for a profit of about $1.4 million, the indictment said. Beginning in February 2015, Hong, Zheng and Hung purchased more than 210,000 Altera shares.Īltera's stock price spiked 26% after news of the confidential merger talks seeped out in the financial press. ![]() The trio stole nearly three gigabytes of confidential data, including secret emails that contained the proposed takeover price in the Altera deal, authorities allege. The indictment cited one incident in which Hong, Zheng and Hung allegedly hacked into a law firm that was hired in January 2015 by Intel ( INTC) to help it devise a takeover of rival chip maker Altera. Federal prosecutors described them as "prominent U.S.-based international law firms with offices in New York." The insider trading scored him $331,000, according to prosecutors.Īuthorities did not identify which law firms were victimized by the Chinese hackers. Earlier this month, a former Expedia ( EXPE) IT professional admitted to illegally trading on secrets he discovered by hacking his own company's senior executives. The allegations are the latest apparent evidence of an intersection between cyber crime and insider trading. The SEC named Hong's mother as a relief defendant to try to recover ill-gotten gains in her accounts linked to the insider trading. The SEC is seeking an asset freeze to prevent Hong, Zheng and Hung from cashing in their illegal gains. "You are and will be targets of cyber hacking, because you have information valuable to would-be criminals," Bharara said in a statement. Attorney for the Southern District of New York, said the case should serve as a "wake-up call for law firms around the world." Related: Drugs, prostitutes used to bribe pension fund manager The defendants then purchased shares of those companies, scoring over $4 million in illegal profits, authorities allege. The hackers scoured the emails of law firm partners to discover stocks that were likely to soar because they were targeted in merger deals, including one tech company Intel would later acquire for $17 billion. ![]()
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