U.S. charges Russian national in multimillion-dollar hacking and trading scheme

The Department of Justice announced Monday extradition Saturday of a Russian national for his role in hacking and illegal trading scheme. Four other Russian nationals have also been charged in the trading scheme. File Photo by Leigh Vogel/UPI.
The Department of Justice announced Monday extradition Saturday of a Russian national for his role in hacking and illegal trading scheme. Four other Russian nationals have also been charged in the trading scheme. File Photo by Leigh Vogel/UPI. | License Photo

Dec. 20 (UPI) -- The Department of Justice announced Monday that a Russian businessman charged in a global multimillion-dollar hacking and trading scheme has been extradited to the United States.

The Russian businessman, identified as Vladislav Klyushin, 41, of Moscow, was extradited to the United States on Saturday from Switzerland, the Justice Department said in a statement.


Klyushin was headed to a ski vacation to Switzerland with his family on a private jet when he was arrested after stepping off the plane on March 21, according to NBC News and Politico.

Kylushin was arrested in Sion, Switzerland, known in the winter for its access to nearby ski resorts, according to the DOJ

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He was allegedly involved in a global scheme to trade on non-public information stolen from U.S. computer networks that netted tens of millions of dollars in illegal profits, according to the DOJ's announcement.


Charges against him were unsealed Monday in the federal courthouse in Boston.

Klyushin has been charged with conspiring to obtain unauthorized access to computers, and to commit wire fraud and securities fraud.

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Along with Klyushin, four other Russian nationals were also charged in the scheme, according to the DOJ, including Ivan Ermakov, 35, Nikolai Rumiantcev, 33, both of Moscow; and Mikhail Irzak, 43, and Igor Sladkov, 42, both of St. Petersburg.

All five allegedly agreed to trade in the securities of publicly traded companies based on material non-public information about the earnings of the companies between 2018-2020, the DOJ statement said.

"The integrity of our nation's capital markets and of its computer networks are priorities for my office," acting U.S. Attorney Nathaniel Mendell said in the statement. "Today's charges show that we, the FBI, and other law enforcement partners will relentlessly pursue those who hack, steal and attempt to profit from inside information, wherever they may hide."

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If convicted on the charge of unauthorized access to computers, each could face a maximum sentence of five years in prison, and if convicted on charged of securities fraud and wire fraud, each could face a maximum of 20 years in prison, according to the DOJ.


A conviction on the charges can also result in fines and a period of supervised release.

In particular, during a period between Oct. 22, 2018, and Nov. 16, 2018, Ermakov or another co-conspirator gained unauthorized access into a filing agent's computer network and viewed non-public earnings-related files of several companies, according to court documents.

Among these companies, were Capstead Mortgage, Tesla, SS&C Technologies and Nevro.

Klyushin served as the first deputy general director of M-13, an information technology company based in Moscow, where Ermakov and Rumiantcev also worked, according to the charging documents.

M-13 purported to offer penetration testing and "Advanced Persistent Threat emulation," as services that sought to exploit vulnerabilities in a computer system, purportedly for defensive purposes, the DOJ said in a statement.

The company's website indicated the company's "IT solutions" were used by "the administration of the president of the Russian Federation, the government of the Russian Federation, federal ministries and departments, regional state executive bodies, commercial companies and public organizations," the statement said.

Klyushin, Ermakov and Rumiantcev also allegedly offered investors management services through the company in exchange for 60% of the profit.

Russia had objected to Kylushin's extradition, according to Russia state media.

"We must note that we are dealing with yet another case of Washington's ongoing 'hunt' for Russian citizens in third countries," press secretary of the Russian Embassy in Bern Vladimir Khokhlov told TASS Sunday. "We are deeply saddened by the Swiss Federal Office of Justice's decision and hasty extradition of Russian national Klyushin."


The DOJ noted in its statement that co-defendant Ermakov, a former officer in the Russian Main Intelligence Directorate, a military agency of the General Staff of Armed Forces of the Russian Federation, has previous charges against him in separate cases.

Ermakov was previously charged in July 2018 in federal court in Washington, D.C., for his alleged role in hacking and influence effort related to the 2016 U.S. elections.

In October 2018, Ermakov was also charged in federal court in Pittsburgh for alleged involvement in hacking and related disinformation operations targeting international anti-doping agencies, sporting federations, and anti-doping officials.

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