March 14, 2007
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NEWS: Indian ID Thieves BustedA trio of Indian hackers who defrauded American online brokerage customers of more than a million dollars were indicted on charges of conspiracy, computer and wire fraud, securities fraud and aggravated identity theft by U.S. authorities last week and expected to face related civil charges filed by the Securities and Exchange Commission. The U.S. is asking for extradition of the three to face charges. Authorities detected the intrusion as early as last fall, but required some time to trace the tracks left by the hackers, who broke into customers' personal accounts to manage the illicit trading.
Jaisankar Marimuthu, 32, of Chennai, India, Thirugnanam Ramanathan, 34, an Indian national who resides in Malaysia, and Chockalingam Ramanathan, 33, also of Chennai were the first ever arrest in connection with online brokerage theft, an area which has brought a handful of SEC lawsuits, but no arrests to date. The three apparently hacked several usernames and accounts of online brokerage customers to manipulate prices of thinly-traded stocks by driving the prices up to artificially inflated levels, then selling them off. At least one hapless customer left for a weeklong vacation with over $150,000 in his account, and came home to find a deficit of $200,000 as a result of the hackers' work. The three manipulated accounts under several firms, including Merrill Lynch, Charles Schwab & Co., and E*Trade.
Affected stocks included Acorda Therapeutics Inc., Earth Products & Technologies Inc., Image Entertainment Inc., Investors Capital Holdings Ltd., Conversion Services International Inc. and Pressure BioSciences Inc., among others.