Authorities Foil 5-Year Scheme of Allegedly Stealing Press Releases Ahead of Corporate News

— -- Federal authorities announced today they have foiled a "cutting edge" scheme to hack more than 150,000 press releases and trade in related stocks before news was made public from companies like Panera Bread and Home Depot.

Acting U.S. Attorney for the Eastern District of New York Kelly Currie called the accused an "unholy alliance of shadowy computer hackers and shadowy securities traders."

"The traders used their market sophistication and their experience to decide when and how to exploit the financial information," Currie said.

Thirty-two people were arrested under criminal and civil charges for a "broad-ranging" and "cutting edge" scheme at the "intersection of hacking and securities fraud," U.S. Attorney for New Jersey Paul Fishman said during a news conference today. Fishman said the hackers sometimes used hacking schemes as simple as phishing that targeted newswire employees.

Two Ukrainian men, Ivan Turchynov, 27, and Oleksandr Ieremenko, 24, "spearheaded" the scheme over a period of five years in which they allegedly hacked three newswire services, including PR Newswire, Business Wire and Marketwired LP, and allegedly stole hundreds of corporate earnings announcements before they were publicly released, prosecutors said. The two allegedly transmitted the stolen data to traders in Russia, Ukraine, Malta, Cyprus, France, and three U.S. states -- Georgia, New York and Pennsylvania, prosecutors said. They allegedly traded prior to more than 800 stolen press releases being publicly issued, prosecutors said

Five of the defendants were arrested in Georgia this morning, the Justice Department said. Turchynov, Ieremenko and two other defendants are believed to be in Ukraine and international arrest warrants were issued today for their arrests, the Justice Department said.

The Department of Justice called it the "largest known computer hacking and securities fraud scheme."

Through wire fraud, securities fraud, money laundering and computer hacking, the hackers and traders allegedly made more than $100 million in illicit profits, the Securities and Exchange Commission said in a statement.

Securities and Exchange Commission Chair Mary Jo White said "the traders were market-savvy" and made moves in options, contracts and stocks. The commission's investigation is ongoing, she said.