Trader Pleads Guilty to Conspiring With Pastor in Hacking Schemeby
Alexander Garkusha cooperating in probe, his lawyer says
Garkusha admits using stolen press releases for trading
A Georgia man pleaded guilty to conspiring with a Pennsylvania pastor and others in what prosecutors describe as a multimillion-dollar global insider-trading scheme involving an alliance with hackers.
Alexander Garkusha told a federal judge in Brooklyn, New York, on Monday that he made $125,000 off of trades using stolen press releases he obtained as part of the scheme, which prosecutors say took place from about February 2010 to August 2015.
“I had lost a lot of money and I decided to get involved to buy stocks,” Garkusha told U.S. Magistrate Judge Ramon Reyes. “I am very sorry I did this. I know it was against the law.”
Garkusha, a former real estate developer, is one of nine people charged in two indictments unsealed in August in federal courts in Brooklyn and Newark, New Jersey, in connection with the probe.
U.S. authorities said that hackers stole more than 150,000 press releases from Business Wire, Marketwired and PR Newswire as part of the scheme. Traders using the information netted more than $100 million in illegal gains, according to the U.S. Securities and Exchange Commission.
Vitaly Korchevsky, a Slavic Evangelical Baptist pastor described by the U.S. as the “linchpin” of the scheme, has pleaded not guilty.
Defense lawyer Jerome Froelich Jr. said in a letter to the court on Dec. 17 that Garkusha is cooperating with the government. His sentencing is scheduled for May 6.
The case is USA v. Korchevsky, 1:15-cr-00381, U.S. District Court, Eastern District of New York (Brooklyn).