U.S. SECURITIES AND EXCHANGE COMMISSION
Securities and Exchange Commission v. Dubovoy, et al., Civil Action No. 2:15-cv-06076 (MCA) (D.N.J. filed Aug. 10, 2015) (amended Aug. 23, 2015)
United States v. Korchevsky, et al., Criminal Action No. 15-cr-00381 (RJD) (E.D.N.Y. unsealed August 11, 2015)
Georgia Trader Pleads Guilty to Hacked News Release Scheme
On August 2, 2016, Leonid Momotok of Suwanee, Georgia pled guilty before United States Magistrate Judge Ramon E. Reyes, Jr. in United States District Court for the Eastern District of New York to one count of conspiracy to commit wire fraud.
The criminal charges against Momotok arose out of the same conduct alleged by the SEC in a civil securities fraud action filed in August 2015. The SEC's amended complaint alleges that Momotok and over 30 other defendants participated in a far-reaching fraudulent scheme, buying and selling stock over approximately five years on the basis of hacked press releases stolen from three newswire services. The SEC has recovered over $52 million and obtained full injunctive relief from the 11 defendants who have agreed to settlements in its case.
The SEC's action against Momotok, which remains pending, seeks an injunction against Momotok for violating the federal securities laws, disgorgement and prejudgment interest of allegedly unlawful trading profits, and civil penalties.
The SEC thanks the U.S. Attorney's Offices for the Eastern District of New York and the Federal Bureau of Investigation for their efforts in prosecuting the case.
The Commission's litigation continues against the remaining defendants charged in the case and a related case filed in February 2016. For more information, see Press Release 2015-163 (Aug. 13, 2015) and Litigation Releases 23345 (Sep. 14, 2015), 23458 (Feb. 2, 2016), 23498 (Mar. 24, 2016), and 23530 (May 4, 2016).