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US charges British man over 'hack-to-trade' scheme
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US charges British man over 'hack-to-trade' scheme
Sep 28, 2024 2:12 AM

Sept 27 (Reuters) - A British man has been arrested and

charged by U.S. authorities with hacking into the computers of

five companies to obtain details about their expected earnings,

and making $3.75 million of illegal profit by trading before

results were released.

The U.S. Department of Justice will seek the extradition of

Robert Westbrook, 39, of London, to face securities fraud, wire

fraud and five computer fraud charges contained in a criminal

indictment made public on Friday.

Westbrook was arrested this week in the United Kingdom, and

also faces related U.S. Securities and Exchange Commission civil

charges. His lawyer could not immediately be identified.

The companies were not identified by name in court papers

filed in federal court in Newark, New Jersey.

Financial and stock price details in the SEC complaint

suggest the companies are food container maker Tupperware

, general contractor Tutor Perini ( TPC ), software

provider Guidewire Software ( GWRE ), gas station operator

Murphy USA ( MUSA ) and telecommunications equipment maker

Lumentum Holdings ( LITE ).

Authorities said Westbrook's "hack-to-trade" scheme involved

gaining access to executives' email accounts between January

2019 and May 2020, and using material nonpublic information to

buy stocks and options prior to at least 14 earnings

announcements.

On several occasions, Westbrook allegedly implemented rules

to have content from executives' email accounts automatically

forwarded to his own accounts.

Jorge Tenreiro, acting chief of the SEC's crypto assets and

cyber unit, called Westbrook's activity a "sophisticated

international hacking," including the use of anonymous email

accounts, VPN services, and bitcoin to conceal wrongdoing.

None of the five companies was accused of wrongdoing.

The securities fraud and wire fraud counts each carry a

maximum 20-year prison term, while each computer fraud count

carries a maximum five-year term.

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