Federal charges including conspiracy to commit securities fraud and hacking are expected to be filed against the nine men in Brooklyn and New Jersey, the person said. The SEC is pursuing a parallel civil case against some of the individuals.
With nine defendants spanning two, possibly three, countries, it’s not yet clear who the mastermind was behind the plot to occupy the wire services’ computers and trade on the stolen information.
Only one professional trader was arrested, in Pennsylvania, and he is described as the linchpin of the markets strategy. He ran a mutual fund and worked on Wall Street before starting his own hedge fund. The rest of the group lacks similar financial credentials. They list themselves in myriad real estate and construction businesses.
The scarce credentials show that in the new world of insider trading anyone willing to pay for hackers’ services may be able to obtain information for illicit trading. Whatever the nine men’s connections, they are missing those common to many of the major cases brought by New York prosecutors in recent years, things like Ivy League schools and Wall Street employers and top consulting firms.