Georgia Man Pleads Guilty in $30 Million Hacking Scheme

SUWANEE, GA — A Georgia man has pleaded guilty to an international computer hacking scheme in which he and others netted more than $30 million from illegal stock trades they made based on stolen, unpublished press releases.

Leonid Momotok, 48, of Suwanee, pleaded guilty to conspiracy to commit wire fraud on Tuesday in U.S. District Court in New York.

Prosecutors say Momotok and others made millions off of the scheme, in which hackers in Ukraine hacked into three business newswires and repeatedly stole press releases that hadn't been published yet.

Using information from the unpublished press releases, such as earnings reports, revenues and the like, Momotok and others would rush to make stock trades before the information became known to the rest of the public.

He and other traders traded on stolen press releases from publicly traded companies including Align Technology Inc., Caterpillar Inc., Hewlett Packard, Home Depot, Panera Bread Co. and Verisign Inc.

"Momotok and his group of traders engaged in a brazen scheme that was unprecedented in its scope, impact and sophistication," said U.S. Attorney Robert L. Capers in a news release. "Today’s guilty plea demonstrates our steadfast commitment and preparedness to combating the ever-evolving threat of cybercrime and to protecting the integrity of our financial markets."

FBI Assistant Director-In-Charge Diego Rodriguez called the scheme "one of the most sophisticated insider trading cases we’ve seen to date."

According to court filings and evidence presented at the plea hearing, the scheme ran from February 2010 to August 2015. Momotok and other traders would give the overseas hackers "wish lists" or "shopping lists" of upcoming press releases they were interested in seeing.

The hackers gained unauthorized access to Marketwired L.P., PR Newswire Association LLC (PRN) and Business Wire. They were paid a percentage of the illegal proceeds, sent to them via overseas shell companies.

When sentenced, Momotok faces up to 20 years in prison, as well as having to pay restitution, criminal forfeiture and a fine.