Title: Macau Resident Charged with Insider Trading, Hacking in US

Three Individuals Indicted for Hacking, Security Fraud, and Insider Trading

A Macau resident, Iat Hong, and two others, Bo Zheng from Macau and Chin Hung from China, were charged by the US Department of Justice (DoJ) with hacking, security fraud, and insider trading. The individuals were taken into custody in their respective countries, and the DoJ initiated extradition proceedings against Hong.

Alleged Hacking of Law Firms and Insider Trading

The 13-count indictment against the trio alleges that they successfully hacked the networks of two major New York law firms by planting malware on their Web servers. Their ultimate goal was to steal confidential data, specifically emails relating to forthcoming mergers and acquisitions (M&A) of clients. With this insider information, the group is accused of manipulating the market by trading in stocks that were expected to rally post-announcement of the transactions. The group earned a profit of at least $4 million through insider trading.

Attempted Breaches and Business Gains

The group attempted to breach the computers of five other law firms, making at least 100,000 intrusion attempts. The group also allegedly launched a start-up robotics company and hacked the servers of two robotics firms to gain competitive advantages and steal information on product design and technology.

List of Charges against the Accused Individuals

The Department of Justice has detailed the charges against Iat Hong and his co-conspirators on their website, including charges of:

• Conspiracy to commit wire fraud, securities fraud, and to tamper with a witness, computer and others.
• Fraud in connection with manipulative and deceptive devices and contrivances.
• Unauthorized access to a protected computer to obtain information.
• Receiving stolen property.

About the Author(s)

This article is derived from a US Department of Justice press release.