By Christopher M. Matthews, Emily Glazer and Devlin Barrett
U.S. authorities charged five people Tuesday in the first cases
bearing some link to the massive cyberattack on J.P. Morgan Chase
& Co. last year.
The men were accused of crimes ranging from securities fraud to
money laundering--not with anything directly related to the attack
on the bank--but U.S. officials confirmed there was a link.
The names of two of the men arrested Tuesday appeared in an
Federal Bureau of Investigation memo circulated last fall that
listed several people of interest related to the J.P. Morgan
hacking, a person familiar with the matter said. The officials
wouldn't elaborate on the connection.
The men were charged in a Manhattan federal court Tuesday. Three
were accused of running a pump-and-dump scheme to manipulate stock
prices, while the other two were accused of operating an illegal
bitcoin operation. Separately, the Securities and Exchange
Commission filed civil charges against the three related to the
alleged stock manipulation.
Four of the men were arrested in Florida and Israel, while a
fifth remains at large. None of the court documents detailed the
men's connection to the J.P. Morgan hacking last summer.
The hacking episode ultimately involved the theft of contact
information for about 76 million households world-wide. The stolen
information included names, phone numbers and email addresses. Such
information could be valuable to spammers seeking to target
millions of email accounts as part of a scam.
The bank has said hackers failed to obtain detailed personal
information such as account numbers, passwords, Social Security
numbers or dates of birth.
The hackers were in the bank's networks for about two months
undetected, raising concerns about the ability of companies and law
enforcement to fend off such attacks, people familiar with the
matter have said.
The breach took on political overtones as well. At the time it
became public last summer, initial evidence suggested the hacker or
hackers may have been located in Russia, prompting speculation that
the Russian government could have been seeking to retaliate over
diplomatic disputes with the U.S.--a suggestion that was discounted
by a number of federal cybersecurity officials.
On Tuesday, law-enforcement agents in Israel arrested Gery
Shalon and Ziv Orenstein. Federal prosecutors in Manhattan charged
them in an indictment with securities fraud and other charges in
connection with what they alleged was a multimillion-dollar
pump-and-dump scheme. Mr. Shalon and Mr. Orenstein are Israeli
citizens, and the U.S. will seek their extradition, prosecutors
said. Prosecutors charged a third man, Joshua Samuel Aaron, who is
a U.S. citizen living in Russia and remains at large.
In two separate complaints, New York prosecutors charged Yuri
Lebedev and Anthony Murgio with running an unlicensed bitcoin
exchange. Both men were arrested at their homes in Florida on
Tuesday, prosecutors said. The pair allegedly operated Coin.mx
which allowed customers to exchange cash for virtual currency.
Messrs.. Lebedev and Murgio allegedly allowed victims of
cyberattacks to buy bitcoin to pay ransom to hackers who had seized
control of the victims' computers, prosecutors said, allowing
hackers to receive the proceeds of their crime.
Messrs. Shalon, Orenstein, Lebedev and Murgio were in custody
and couldn't be reached for comment. Mr. Aaron also couldn't be
reached for comment.
It wasn't clear whose names appeared on the FBI memo last
fall.
Write to Christopher M. Matthews at
christopher.matthews@wsj.com, Emily Glazer at emily.glazer@wsj.com
and Devlin Barrett at devlin.barrett@wsj.com
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