He bought shares based on stolen newswire articles
A US stock trader has admitted he profited from insider trading – by buying and selling shares using tip-offs from Ukrainian newswire hackers.
Leonid Momotok, 48, of Suwanee, Georgia, pleaded guilty in a Brooklyn court on Monday to charges of conspiracy to commit wire fraud. He could get up to 20 years behind bars in addition to fines and forfeitures.

“I profited from these trades.
It was bad judgment and I am very sorry,” he told federal court Judge Ramon Reyes.
Momotok was among 32 people charged by America’s financial watchdog the SEC in 2015 after investigators broke up a Ukrainian-based hacking ring that traded on insider information from stolen unpublished press releases.
The hackers obtained employee account credentials to break into the systems of three newswire services – Business Wire, Marketwired and PR Newswire – to access press releases and company announcements that had not yet been released to the general public.
The hackers then passed the stolen releases, roughly 300,000 in all, to their investor partners in the US, who were able to make trades based on the insider information before the market could react to any breaking news.

A portion of the profits were then kicked back to the hackers as payments.
Because the trades had to be made in a short window of time after getting the information, the SEC says that the investors gave the hackers “shopping lists” of companies they sought info on, including HP, Verisign, and Home Depot, in the hours between when the release was given to the wire services and when it was made public.
In total, the SEC estimates that the scheme netted Momotok and others in his group roughly $30m in ill-gotten gains.
It constitutes the single largest insider trading scam to date.
“Using non-public press releases stolen by overseas hackers, Momotok and his group of traders engaged in a brazen scheme that was unprecedented in its scope, impact and sophistication,” said Robert Capers, US Attorney for the Eastern District of New York.
“Today’s guilty plea demonstrates our steadfast commitment and preparedness to combating the ever-evolving threat of cybercrime and to protecting the integrity of our financial markets.”
Momotok, a Russian-born naturalized US citizen, also agreed not to appeal any sentence shorter than nine years. He will be sentenced in early December. ®
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