US charges British man over 'hack-to-trade' scheme
By Jonathan Stempel
(Reuters) - A British man has been arrested and charged by U.S. authorities with hacking into the computers of five companies to obtain details about their expected earnings, and making $3.75 million of illegal profit by trading before results were released.
The U.S. Department of Justice will seek the extradition of Robert Westbrook, 39, of London, to face securities fraud, wire fraud and five computer fraud charges contained in a criminal indictment made public on Friday.
Westbrook was arrested this week in the United Kingdom, and also faces related U.S. Securities and Exchange Commission civil charges. His lawyer could not immediately be identified.
The companies were not identified by name in court papers filed in federal court in Newark, New Jersey.
Financial and stock price details in the SEC complaint suggest the companies are food container maker Tupperware (NYSE:TUP ), general contractor Tutor Perini (NYSE:TPC ), software provider Guidewire (NYSE:GWRE ) Software, gas station operator Murphy USA (NYSE:MUSA ) and telecommunications equipment maker Lumentum Holdings (NASDAQ:LITE ).
Authorities said Westbrook's "hack-to-trade" scheme involved gaining access to executives' email accounts between January 2019 and May 2020, and using material nonpublic information to buy stocks and options prior to at least 14 earnings announcements.
On several occasions, Westbrook allegedly implemented rules to have content from executives' email accounts automatically forwarded to his own accounts.
Jorge Tenreiro, acting chief of the SEC's crypto assets and cyber unit, called Westbrook's activity a "sophisticated international hacking," including the use of anonymous email accounts, VPN services, and bitcoin to conceal wrongdoing.
None of the five companies was accused of wrongdoing.
The securities fraud and wire fraud counts each carry a maximum 20-year prison term, while each computer fraud count carries a maximum five-year term.
Source: Investing.com
