4 Arrested, Linked in Stock Pumping, Hacking and Bitcoin Laundering Schemes

Four were arrested in what was apparently two separate investigations, but have been linked through a third into the hacking

Four men were arrested in what would seem to be two separate investigations, but have been linked through a third into the 2014 hacking of JPMorgan Chase, one of the biggest data breaches in history.

Gery Shalon and Ziv Orenstein were arrested in Israel today, charged by the US for allegedly manipulating the prices of at least five US stocks in a pump-and-dump scheme. A third, Joshua Samuel Aaron, who resided intermittently in both the US and Israel, remains at large in Russia, out of reach from US authorities.

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The men allegedly sent promotional e-mails to victims to buy “hot” stocks in which they had holdings, thereby inflating their value. They then sold their holdings, gaining $2.8 million in illegal profits, at the expense of their victims.

In an apparently separate investigation, two more were arrested in Florida for operating an unlicensed money business involving bitcoins. Anthony Murgio and Yuri Lebedev allegedly operated Coin.mx to help launder at least $1.8 million worth of bitcoin on behalf of tens of thousands of customers. Among them were hackers looking to launder the proceeds gained from ransomware attacks.

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The arrests are at least the third instance in the state of those carried out for bitcoin-related money laundering. Last year, two were arrested for money laundering, not long after Robert Faiella was arrested at the same time as Charlie Shrem for their BitInstant-Silk Road activities.

The recent arrests in Florida and Israel are possibly linked, according to Bloomberg, by the massive data breach of JPMorgan Chase in October 2014. The data from over 83 million accounts was stolen, an incident believed to have been perpetrated by Russian hackers.

Murgio and Aaron were reportedly friends dating back to their days at Florida State University. Although the FBI has not yet linked their alleged crimes to each other directly, the two were possibly linked in investigations into hacking incidents at JPMorgan, Fidelity Investments Ltd. and E*Trade Financial Corp.

The information from the stock brokerages can possibly be used to hack into customer accounts and buy up shares in stocks the hackers wish to pump.

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