The US Attorney’s Office for the District of Massachusetts announced the conviction of Russian businessman Vladislav Klyushin for his alleged role in a global scheme to steal earnings information of certain publicly-traded US companies and then trade in the securities of those companies in advance of their public earnings announcements. According to federal prosecutors, the scheme generated approximately $90 million in profits. Klyushin, who was arrested in Switzerland and extradited to the US in 2021, was charged by US authorities with wire fraud, unauthorized access to computers, securities fraud and conspiracy. Four of Klyushin’s alleged co-conspirators – Ivan Ermakov, Nikolai Rumiantcev, Vladimirovich Irzak and Igor Sergeevich Sladkov – were charged with civil and/or criminal violations for their roles in the scheme; however, they all remain at large. On February 14, 2023, a federal jury found Klyushin guilty on all counts. He is currently scheduled to be sentenced in Boston on May 4, 2023.
According to the USAO, Klyushin is the owner of M-13, a Moscow-based information technology company that offers to explore companies’ computer system vulnerabilities using hacking techniques, purportedly for defensive purposes. According to the indictment, M-13’s website also indicates that the company has provided services to “the Administration of the President of the Russian Federation, the Government of the Russian Federation, federal ministries and departments” and other commercial and pubic organizations in Russia. According to evidence presented at trial, from at least January 2018 to September 2020, Klyushin and his co-conspirators stole earnings information by hacking into the computer networks of two US-based filing agents and then purchasing securities based on this nonpublic information before the information was filed with the Securities and Exchange Commission and released to the public. Klyushin and his team were allegedly able to hack into the networks by deploying a malicious infrastructure that allowed them to steal employees’ login information, which they used to access un-filed quarterly and annual earnings reports for hundreds of companies – many of which were downloaded through a computer server located in Boston in order to conceal the true origins of their activities.
Klyushin reportedly purchased securities for himself and several investors from whom he took 60 percent of the profits, using brokerage accounts in several countries, including Cyprus, Denmark, Portugal, Russia and the US, held in Klyushin’s name and in the names of others. The scheme allegedly generated close to $100 million in profits and almost $10 million in losses, with Klyushin netting more than $38 million in personal gains.