Feeds

Prison time for cyber stock swindler

Computer hacking and identity theft

  • alert
  • submit to reddit

Security for virtualized datacentres

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

Beginner's guide to SSL certificates

More from The Register

next story
FYI: OS X Yosemite's Spotlight tells Apple EVERYTHING you're looking for
It's on by default – didn't you read the small print?
Microsoft pulls another dodgy patch
Redmond makes a hash of hashing add-on
NOT OK GOOGLE: Android images can conceal code
It's been fixed, but hordes won't have applied the upgrade
Edward who? GCHQ boss dodges Snowden topic during last speech
UK spies would rather 'walk' than do 'mass surveillance'
DEATH by PowerPoint: Microsoft warns of 0-day attack hidden in slides
Might put out patch in update, might chuck it out sooner
'LulzSec leader Aush0k' found to be naughty boy not worthy of jail
15 months home detention leaves egg on feds' faces as they grab for more power
prev story

Whitepapers

Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
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?
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.