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Russian Millionaire Hacker Convicted in $90 Million Fraud

A jury in Boston federal court has convicted the owner of a Moscow-based information technology company with ties to the Kremlin in a $90 million insider trading scheme, the Associated Press reports. Vladislav Klyushin, 42, whose company purported to provide services to detect vulnerabilities in computer systems, was found guilty on all counts, including wire fraud and securities fraud, after a two-week trial. U.S. Attorney Rachael Rollins said in a statement that Klyushin and his co-conspirators, who remain at large, "repeatedly hacked into U.S. computer networks to obtain tomorrow’s headlines today," using secret earnings information from companies such a Microsoft. Klyushin’s attorney, Maksim Nemtsev, said in an email that he and his client are disappointed but respect the jury’s verdict. He said they intend to appeal, adding that the case included “novel theories” that have never before been reviewed or adopted by higher courts.


Klyushin's company counted among its clients the administration of Russian President Vladimir Putin and other government entities. Prosecutors say hackers stole employees’ usernames and passwords for two U.S.-based vendors that publicly traded companies use to make filings through the Securities and Exchange Commission. They then broke into the vendors’ computer systems to get financial disclosures for hundreds of companies, including Microsoft, Tesla, Kohls, Ulta Beauty and Sketchers, before they were filed with the SEC and became public. Armed with this insider information, they were able to cheat the stock market, alleged prosecutors, who said Klyushin personally turned a $2 million investment into nearly $21 million. Altogether, the group turned about $9 million into nearly $90 million. Klyushin was close friends with a Russian military officer who was among 12 Russians charged in 2018 with hacking into key Democratic Party email accounts, including those belonging to Hilary Clinton’s presidential campaign chairman, John Podesta, the Democratic National Committee and the Democratic Congressional Campaign Committee.

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