Duluth businessman sentenced for bribing DeKalb official

A trader from Alpharetta admitted to involvement in what U.S. authorities have called a more than $100 million international insider trading scheme that involved hacking into networks that distribute corporate news releases.

Igor Dubovoy, 28, pleaded guilty on Wednesday to one count of conspiracy to commit wire fraud, according to U.S. Attorney Paul Fishman in New Jersey.

Dubovoy became the second defendant to admit criminal wrongdoing related to the alleged theft from February 2010 to August 2015 of more than 150,000 press releases from Business Wire, MarketWired and PR Newswire.

The defendant entered his plea before U.S. District Judge Madeline Cox Arleo in Newark, New Jersey. He faces up to 20 years in prison, and according to his plea agreement agreed to make $3 million of restitution to the newswires.

Another trader from Alpharetta, Alexander Garkusha, pleaded guilty last month in Brooklyn, New York federal court to the same charge as Dubovoy.

Seven other individuals, including accused hackers from Ukraine, also face criminal charges, and 34 defendants face related U.S. Securities and Exchange Commission civil charges.

Lawrence Lustberg, a lawyer for Dubovoy, declined to comment.

Authorities said traders would give hackers "shopping lists" of press releases they wanted to see in advance, and then made trades based on them in such companies as Caterpillar Inc, Home Depot Co and Panera Bread Co.

Prosecutors said Dubovoy admitted to buying stolen press releases that he knew contained non-public earnings data for publicly traded companies, and that he made trades based on their contents after sending them to another trader to review.

Business Wire is a unit of Warren Buffett's Berkshire Hathaway Inc. PR Newswire is a unit of Britain's UBM Plc, which last month said it will sell the unit to Chicago-based Cision.None of the newswires was accused of wrongdoing.

The case is U.S. v. Dubovoy, U.S. District Court, District of New Jersey, No. 15-cr-00390.

(Reporting by Jonathan Stempel in New York; Editing by Alan Crosby)

(0) comments

Welcome to the discussion.

Please log in, or sign up for a new, free account to read or post comments.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.

Trending Videos

Support Local Journalism

Now, more than ever, the world needs trustworthy reporting—but good journalism isn’t free. Please support us by subscribing or making a contribution today.