Beware the Trojan Horse (from Russia)

Written: April 14, 2010 http://www.brokeandbroker.com/index.php?a=blog&id=369

In a case prosecuted by the Complex Frauds Unit of the United States Attorney’s Office (Southern District of New York), we learn that from approximately September 2006 through December 2007, Aleksey Volynskiy and co-defendant Alexander Bobnev participated in a scheme to steal funds from bank and brokerage accounts by hacking into those accounts through the internet, using personal financial information obtained through computer viruses, and then laundering the stolen proceeds.

 

Enter the Trojan Horse

In carrying out their scheme, Bobnev and co-conspirators in Russia used concealed computer codes known as "Trojan Horses" to hack into the personal computers of multiple victims in the United States. These Trojan Horses were designed to steal personal account information from individual victims as they accessed their bank and brokerage accounts through the internet. After the Trojan Horses captured the victims' personal account information, Bobnev and other co-conspirators used the information to access victims' bank and brokerage accounts, and thereafter made unauthorized sales of securities and unauthorized wire transfers out of these accounts.

 

Drop Accounts

Volynskiy, along with co-conspirators residing in the United States, then set up various "drop" accounts to receive the funds stolen from their victims' bank and brokerage accounts. Volynskiy and his co-conspirators then sent a portion of the stolen funds from the various "drop" accounts in the United States to co-conspirators in Russia, through money remitting services, keeping a portion of the fraud proceeds for themselves.

 

Stolen Credit Card Numbers

In addition to the scheme to hack into victims' brokerage accounts, from September 2006 through December 2007  Volynskiy participated in a scheme to steal funds from bank accounts by withdrawing money from those accounts at ATMs, using stolen credit card numbers. On three separate occasions, Volynskiy provided a total of 180 stolen credit card numbers to a cooperating witness, directing that they be fabricated into credit cards.

The Long Arm of the Law Grabs Two

In June 2009, Alexey Mineev, a naturalized U.S. citizen of Hampton, New Hampshire, pleaded guilty for his part in stealing over $112,000 as part of the brokerage accounts scheme using the Trojan Horse. On November 9, 2009, Mineev was sentenced in U.S. District Court to 18 months in prison.

Volynskiy was arrested on December 4, 2008, and pleaded guilty on August 4, 2009, to five counts, including conspiracy to commit wire fraud and unlawfully access and damage a protected computer, money laundering, and access device fraud.

On April 6, 2010, Volynskiy was sentenced in U.S. District Court to 37 months in prison for hacking into victims’ brokerage accounts at Charles Schwab, laundering over $246,000, and sending a portion back to co-conspirators in Russia. Volynskiy also sold approximately 180 stolen credit card numbers to a cooperating witness and directed that they be fabricated into credit cards. United States. He was also ordered to pay restitution in the amount of $30,000 and imposed an order of forfeiture in the same amount.

The Long Arm of the Law Ain’t Long Enough

Bobnev, a Russian citizen purportedly of Volgograd, Russia, is reportedly out of the reach of U.S. law enforcement in his home country and remains at large.

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