5 Hackers Charged in Largest Data-Breach Scheme in U.S.
By David Voreacos - Jul 25, 2013 9:23 AM ET
Four Russians and a Ukrainian were charged for their role in the largest hacking and data breach scheme in U.S. history, according to Paul Fishman, the U.S. attorney in New Jersey.
The five conspired in a “worldwide scheme that targeted major corporate networks, stole more than 160 million credit card numbers and resulted in hundreds of millions of dollars in losses,” Fishman said today in a statement. The men worked with Albert Gonzalez, a hacker serving 20 years in prison, according to the indictment unsealed in federal court in New Jersey.
The men operated “a prolific hacking organization” that “penetrated the secure computer networks of several of the largest payment-processing companies, retailers and financial institutions in the world,” according to the indictment. They are accused of stealing user names and passwords, personal identification information, and credit and debit card numbers.
After stealing data, known as “dumps,” the men sold it to “dumps resellers,” who then sold it through online forums or to individuals and organizations, prosecutors charged. The men encoded the data into the magnetic strips of blank plastic cards and withdrew money from automated teller machines or incurred charges or bought goods through credit cards, the U.S. said.
“Financial institutions, credit card companies and consumers suffered hundreds of millions in losses, including losses in excess of $300 million by just three of the corporate victims, and immeasurable losses to identity theft victims,” according to the indictment. The companies they targeted included Carrefour SA (CA), France’s biggest retailer.
Those indicted were Vladimir Drinkman of Moscow and Syktyvkar, Russia; Aleksandr Kalinin ofSt. Petersburg; Roman Kotov and Dmitriy Smilianets of Moscow; and Mikhail Rytikov of Odessa, Ukraine. The charges include computer hacking conspiracy, wire fraud, conspiracy to commit wire fraud and unauthorized computer access.
Gonzalez was sentenced in March 2010 to 20 years in prison for stealing 130 million credit- and debit-card records from Heartland Payment Systems Inc. (HPY), 7-Eleven Inc., Delhaize Group’s Hannaford Brothers Co. and two unidentified national retailers. Another judge sentenced him to 20 years for stealing 40 million records from retailers including TJX Cos. (TJX), OfficeMax Inc. (OMX) and BJ’s Wholesale Club Inc. The sentences run at the same time.
Drinkman and his conspirators are charged with targeting Heartland, Hannaford, Carrefour, and several other companies.
A second superseding indictment was released today by Fishman’s office. The case isn’t yet available on electronic court records.
The case is U.S. v. Drinkman, 09-cr-00626, U.S. District Court, District of New Jersey.
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