US Charges British Man in ‘Hack-to-Trade’ Scheme, According to Reuters

A British man has been arrested and charged by U.S. authorities for hacking into the computers of five companies to obtain details about their anticipated earnings. He allegedly made $3.75 million in illegal profits by trading stocks before the results were released.

The U.S. Department of Justice is seeking the extradition of Robert Westbrook, a 39-year-old from London, to face charges of securities fraud, wire fraud, and five computer fraud charges outlined in a criminal indictment revealed on Friday.

Westbrook was apprehended this week in the United Kingdom and also faces civil charges from the U.S. Securities and Exchange Commission. His legal representation has not been identified.

The names of the companies involved were not disclosed in the court documents filed in federal court in Newark, New Jersey. However, details in the SEC complaint suggest that the companies may include food container manufacturer Tupperware, general contractor Tutor Perini, software company Guidewire Software, gas station operator Murphy USA, and telecommunications equipment maker Lumentum Holdings.

Authorities reported that Westbrook’s scheme, described as a “hack-to-trade” operation, involved accessing executives’ email accounts between January 2019 and May 2020, using nonpublic information to purchase stocks and options prior to at least 14 earnings announcements. On several occasions, Westbrook allegedly set rules to automatically forward content from these email accounts to his own.

Jorge Tenreiro, acting chief of the SEC’s cyber unit, characterized Westbrook’s actions as a “sophisticated international hacking” operation that utilized anonymous email addresses, VPN services, and bitcoin to mask his illicit activities.

None of the five companies involved has been accused of any wrongdoing. The charges of securities fraud and wire fraud each carry a maximum penalty of 20 years in prison, while each computer fraud charge could result in a maximum of five years.