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Hacker given two years for stocks fraud | | 2008/09/11 | | An audacious money-making scheme designed to manipulate the stock market has resulted in a two-year custodial sentence for its mastermind.
The international fraud ring led by Thirugnanam Ramanathan developed a new-style of stock manipulation known as 'Pump-and-Dump' which works, theoretically, by legitimately buying low-value shares and then hacking into the internet accounts of American brokerage houses to buy the same shares to boost their market price.
Once the price had jumped sufficiently, the gang would divest themselves of the stock at a profit.
The 35-year-old Indian who operated as a legal resident of Malaysia carried out the fraud over 11 months in 2006 with two accomplices.
Senior technology consultant at internet security firm Sophos Graham Cluley told VNU Net: "A heist like this was nothing less than audacious - and, if successful, could have netted the criminals a fortune.
"This gang didn't use the old trick of pumping up the price of a dormant stock with spam messages, encouraging people to buy shares in a stock whose price was going to be manipulated.
"Instead they cut out the middle man - doing the purchasing of the stock through their victims' own compromised accounts."
The case has highlighted the need for website monitoring as it shows that the gang had used ISPs in Bangkok and Chennai to perpetrate crime in America.
Jaisankar Marimuthu will face these fraud charges following his extradition from a Hong Kong prison where he is serving time for similar offences, while the whereabouts of the third accomplice, Chockalingam Ramanathan, remains unknown. |
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