Chinese Hackers Must Pay $8.9 Million in Law Firm Data Theftby
Three defendants used stolen information to trade, U.S. says
Federal judge in New York orders civil forfeiture and fines
Three Chinese hackers who stole information on deals from two top New York law firms and used it to trade stocks were ordered to pay $8.9 million in fines, disgorgements and interest.
U.S. District Judge Valerie Caproni in Manhattan issued the May 5 order in favor of the U.S. Securities and Exchange Commission, but the hackers -- Iat Hong, Bo Zheng and Hung Chin -- aren’t in the U.S. Hong was arrested in December in Hong Kong and is awaiting extradition, while the whereabouts of the other two aren’t known.
All three also face criminal charges that they made more than $4 million in illegal profits from using the stolen information.
Hong, Zheng and Chin profited on deals and speculation involving the drug maker Intermune Inc., chipmaker Intel Corp. and business-services company Pitney Bowes Inc., according to prosecutors.
The law firms weren’t identified in the criminal charges or the SEC case. The Wall Street Journal reported in March that Cravath Swaine & Moore LLP and Weil Gotshal & Manges LLP were among the targeted law firms. Spokeswomen for the firms didn’t return voicemails and emails seeking comment.
The case is Securities and Exchange Commission v. Hong, 16-cv-09947, U.S. District Court, Southern District of New York.