Big boys're charged in huge cyberfraud# Stock
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U.S. charges three in huge cyberfraud targeting JPMorgan, others
By Jonathan Stempel and Nate Raymond
NEW YORK (Reuters) - U.S. prosecutors on Tuesday unveiled criminal charges
accusing three men of running a sprawling array of hacking and fraud schemes
, including a huge 2014 attack against JPMorgan Chase & Co, that generated
hundreds of millions of dollars of illegal profit.
Gery Shalon, Joshua Samuel Aaron and Ziv Orenstein were charged in a 23-
count indictment over alleged crimes targeting 12 companies, including nine
financial services companies as well as media outlets including The Wall
Street Journal.
Prosecutors said the enterprise dated to 2007 and included pumping up stock
prices, online casinos, payment processing for criminals, an illegal bitcoin
exchange, and at least 75 shell companies and accounts around the world.
Another defendant, Anthony Murgio, was charged over the bitcoin exchange.
"By any measure, the data breaches at these firms were breathtaking in scope
and in size," U.S. Attorney Preet Bharara said at a press conference.
Tuesday's charges substantially expand a criminal case first announced in
July. They are also the first tied to the JPMorgan attack, which compromised
information in 83 million customer accounts in what prosecutors called the
largest theft of customer data from a U.S. financial institution.
Authorities said Shalon and Aaron executed that hacking, using a computer
server in Egypt that they had rented under an alias that Shalon often used.
E*Trade Financial Corp, TD Ameritrade Holding Corp and News Corp's Dow Jones
unit, which publishes The Wall Street Journal, said they were also targeted
by defendants in the case.
Fidelity Investments was also a target, a person familiar with the matter
said, and Scotttrade Inc was also a target, according to a law enforcement
source.
Shalon, 31, and Orenstein, 40, are Israeli nationals who were arrested in
July. Murgio, from Florida, was also arrested that month. Aaron, 31, is a U.
S. citizen who has lived in Moscow and Tel Aviv.
JPMorgan on Tuesday confirmed that the latest charges relate to the 2014
attack, and said it continues to cooperate with law enforcement efforts to
fight cybercrime.
E*Trade said it has contacted 31,000 customers who may have been affected.
News Corp said the indictment relates to a breach that targeted subscribers,
and which was disclosed on Oct. 9.
Lawyers for the defendants were not immediately available for comment.
WANTED MAN
The new charges portray Shalon as the ringleader, having orchestrated
hackings since 2012 against nine companies in which personal information for
more than 100 million customers was stolen.
He and Orenstein were accused of having since 2007 run at least 12 illegal
Internet casinos, generating millions of dollars of profit each month.
They allegedly also ran IDPay and Todur, through which they collected $18
million of fees to process hundreds of millions of dollars of transactions
for criminals.
According to the indictment, the illegal proceeds included tens of millions
of dollars from manipulating the prices of stocks sold to customers whose
information had been stolen.
Shalon was also accused of concealing at least $100 million in Swiss and
other accounts, and running Coin.mx with Murgio.
Aaron, meanwhile, was identified in an FBI "wanted" poster as the "front-man
" in a scheme where, using the alias "Mike Shields," he conspired to drive
up stock prices and then dump shares at inflated prices, collecting tens of
millions of dollars of profit.
The indictment against Shalon, Orenstein and Aaron includes counts of
computer hacking, securities and wire fraud, identity theft, illegal
Internet gambling and conspiring to commit money laundering. Not all counts
were brought against all defendants.
Murgio faces seven counts including wire fraud, money laundering and
operating an unlicensed money transmitter.
The U.S. Securities and Exchange Commission previously filed civil charges
against Shalon, Aaron and Orenstein.
The cases are U.S. v. Shalon et al, U.S. District Court, Southern District
of New York, No. 15-cr-00333; and U.S. v. Murgio in the same court, No. 15-
cr-00769.
By Jonathan Stempel and Nate Raymond
NEW YORK (Reuters) - U.S. prosecutors on Tuesday unveiled criminal charges
accusing three men of running a sprawling array of hacking and fraud schemes
, including a huge 2014 attack against JPMorgan Chase & Co, that generated
hundreds of millions of dollars of illegal profit.
Gery Shalon, Joshua Samuel Aaron and Ziv Orenstein were charged in a 23-
count indictment over alleged crimes targeting 12 companies, including nine
financial services companies as well as media outlets including The Wall
Street Journal.
Prosecutors said the enterprise dated to 2007 and included pumping up stock
prices, online casinos, payment processing for criminals, an illegal bitcoin
exchange, and at least 75 shell companies and accounts around the world.
Another defendant, Anthony Murgio, was charged over the bitcoin exchange.
"By any measure, the data breaches at these firms were breathtaking in scope
and in size," U.S. Attorney Preet Bharara said at a press conference.
Tuesday's charges substantially expand a criminal case first announced in
July. They are also the first tied to the JPMorgan attack, which compromised
information in 83 million customer accounts in what prosecutors called the
largest theft of customer data from a U.S. financial institution.
Authorities said Shalon and Aaron executed that hacking, using a computer
server in Egypt that they had rented under an alias that Shalon often used.
E*Trade Financial Corp, TD Ameritrade Holding Corp and News Corp's Dow Jones
unit, which publishes The Wall Street Journal, said they were also targeted
by defendants in the case.
Fidelity Investments was also a target, a person familiar with the matter
said, and Scotttrade Inc was also a target, according to a law enforcement
source.
Shalon, 31, and Orenstein, 40, are Israeli nationals who were arrested in
July. Murgio, from Florida, was also arrested that month. Aaron, 31, is a U.
S. citizen who has lived in Moscow and Tel Aviv.
JPMorgan on Tuesday confirmed that the latest charges relate to the 2014
attack, and said it continues to cooperate with law enforcement efforts to
fight cybercrime.
E*Trade said it has contacted 31,000 customers who may have been affected.
News Corp said the indictment relates to a breach that targeted subscribers,
and which was disclosed on Oct. 9.
Lawyers for the defendants were not immediately available for comment.
WANTED MAN
The new charges portray Shalon as the ringleader, having orchestrated
hackings since 2012 against nine companies in which personal information for
more than 100 million customers was stolen.
He and Orenstein were accused of having since 2007 run at least 12 illegal
Internet casinos, generating millions of dollars of profit each month.
They allegedly also ran IDPay and Todur, through which they collected $18
million of fees to process hundreds of millions of dollars of transactions
for criminals.
According to the indictment, the illegal proceeds included tens of millions
of dollars from manipulating the prices of stocks sold to customers whose
information had been stolen.
Shalon was also accused of concealing at least $100 million in Swiss and
other accounts, and running Coin.mx with Murgio.
Aaron, meanwhile, was identified in an FBI "wanted" poster as the "front-man
" in a scheme where, using the alias "Mike Shields," he conspired to drive
up stock prices and then dump shares at inflated prices, collecting tens of
millions of dollars of profit.
The indictment against Shalon, Orenstein and Aaron includes counts of
computer hacking, securities and wire fraud, identity theft, illegal
Internet gambling and conspiring to commit money laundering. Not all counts
were brought against all defendants.
Murgio faces seven counts including wire fraud, money laundering and
operating an unlicensed money transmitter.
The U.S. Securities and Exchange Commission previously filed civil charges
against Shalon, Aaron and Orenstein.
The cases are U.S. v. Shalon et al, U.S. District Court, Southern District
of New York, No. 15-cr-00333; and U.S. v. Murgio in the same court, No. 15-
cr-00769.
