Feeds

Prison time for cyber stock swindler

Computer hacking and identity theft

  • alert
  • submit to reddit

Internet Security Threat Report 2014

A young investor with more wiles than trading luck was sentenced to 13 months in prison Wednesday for using a Trojan horse program and someone else's online brokerage account to sell thousands of worthless stock options to an unwilling buyer.

Van T. Dinh, 20, was the first to be charged by the Securities and Exchange Commission with a fraud involving both computer hacking and identity theft, according to the SEC.

According to court records, last July, the then-teenaged Dinh was the unhappy owner of $90,000 in "put" options that could have delivered a hefty payoff if Cisco Systems Inc. stock drooped below $15.00 a share, but instead were close to expiring worthless.

Rather than eat the loss, Dinh constructed an electronic shell game to offload the contracts on a innocent dupe. Dinh built a list of targets by posting innocuous queries as "Stanley Hirsch" to a public forum on the trading discussion site stockcharts.com, and noting the email addresses of people who responded. The next day, using the alias "Tony T. Riechert," he spammed those addresses with an offer to participate in a beta test of a new stock charting tool.

The "stock charting tool" turned out to be a Trojan horse called "the Beast." An unsuspecting Westborough, Massachusetts investor - unnamed in the complaints - ran the program, and sometime thereafter accessed his online brokerage account with TD Waterhouse, while the Beast silently logged every keystroke. Dinh allegedly swept in later and downloaded the logs, obtaining the man's username and password.

A few days later, Dinh put his Cisco options up for sale at an inflated price through his own online broker, then used the purloined password to place a series of matching buy orders through the victim's account, "depleting almost all of the account's available cash," according to the SEC - approximately $47,000.

With the account drained, Dinh remained stuck with some of the Cisco contracts, which expired worthless on 19 July. But the scheme shaved his losses by $37,000 - the victim's $47,000, minus the broker's commission.

Dinh pleaded guilty in a federal court in Massachusetts to unauthorized access to a protected computer and securities fraud last February, and repaid the victim's lost $47,000. At his sentencing hearing Wednesday, prosecutors say they read aloud from an electronic diary purportedly found on Dinh's computer, including an entry dated a month before the crime.

"I am so proud of myself for my 'hacking business' - I will never regret what I did," Dinh allegedly wrote. "I am the best of the best Trickster. I laugh often when mom says she worries - what the [expletive] do you have to worry about. Even if I go to jail - big deal - I will learn something there. Hahaha."

Phone calls to Dinh's home and his attorney's office were not returned Thursday.

Copyright © 2004, SecurityFocus logo

Related stories

Brokerage hack teen charged
Stock spam scams ramping up
Teen charged in cyber stock scam
Feds slap cuffs on Google stock scammer
Hoaxster hacker discovers infinite-wealth algorithm
Trainee(!) dishwasher pleads guilty to $80m identity fraud

Intelligent flash storage arrays

More from The Register

next story
Webcam hacker pervs in MASS HOME INVASION
You thought you were all alone? Nope – change your password, says ICO
You really need to do some tech support for Aunty Agnes
Free anti-virus software, expires, stops updating and p0wns the world
USB coding anarchy: Consider all sticks licked
Thumb drive design ruled by almighty buck
Attack reveals 81 percent of Tor users but admins call for calm
Cisco Netflow a handy tool for cheapskate attackers
Privacy bods offer GOV SPY VICTIMS a FREE SPYWARE SNIFFER
Looks for gov malware that evades most antivirus
Patch NOW! Microsoft slings emergency bug fix at Windows admins
Vulnerability promotes lusers to domain overlords ... oops
prev story

Whitepapers

Choosing cloud Backup services
Demystify how you can address your data protection needs in your small- to medium-sized business and select the best online backup service to meet your needs.
Getting started with customer-focused identity management
Learn why identity is a fundamental requirement to digital growth, and how without it there is no way to identify and engage customers in a meaningful way.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Choosing a cloud hosting partner with confidence
Download Choosing a Cloud Hosting Provider with Confidence to learn more about cloud computing - the new opportunities and new security challenges.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.