Wednesday, March 07, 2007

Feds Move Against Online Trading Criminals

Asa Eslocker and Justin Rood report on ABC News' "The Blotter":

Customers of Merrill Lynch, E*Trade and other major online brokerage firms are being targeted by a ring of Eastern European cybercriminals, federal law enforcement officials tell ABC News.

The Securities and Exchange Commission said today it has moved against the ring which they believe illegally accessed trading accounts at seven top firms from computers in Russia, Latvia, Lithuania and the British Virgin Islands.

Authorities say the ring took control of customers' investments and switched them to penny stocks they controlled in order to temporarily drive up their prices, ultimately leaving the investors with portfolios that were worthless.

A federal judge yesterday evening agreed to an SEC request to freeze $3 million in an account at a U.S. branch of an Eastern European bank, which investigators say belongs to the criminals.

More here.


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