MORE SECURITY FOR EXCHANGES?

The Securities and Exchange Commission (SEC) on Tuesday filed fraud charges against nine individuals and firms that allegedly made more than $4.1 million in trades based on information stolen from the agency.

In a complaint filed with the U.S. District Court in Newark, N.J., the SEC said a group of Russian, Ukrainian and U.S. individuals made the illegal gains using nonpublic information hacked from the agency’s electronic filing system and database.

Ukrainian hacker Oleksandr Ieremenko allegedly overrode authentication checks in the SEC’s Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) to access unreleased earnings reports from 157 companies between May and October 2016.

“International computer hacking schemes like the one we charged today pose an ever-present risk to organizations that possess valuable information,” said Stephanie Avakian, co-director of the SEC’s enforcement division. “Today’s action shows the SEC’s commitment and ability to unravel these schemes and identify the perpetrators even when they operate from outside our borders.”

Ieremenko allegedly shared the stolen information with six individuals and two firms, which made investments based on the nonpublic data, according to the SEC complaint. Ieremenko and Artem Radchenko, a Ukrainian who allegedly helped recruit traders for the scheme, were also indicted on 16 counts of fraud-related charges by the Department of Justice (DOJ).