SEC Enters Settlement with Perpetrators of an Alleged Hacked News Release Scheme
The Securities and Exchange Commission (SEC) announced on March 24, 2016 that it had entered into settlement agreements, subject to court approval, with defendants David Amaryan, Copperstone Alpha Fund, Copperstone Capital, Intertrade Pacific SA, Ocean Prime Inc., Guibor S.A., and Omega 26 Investments Ltd. in a case alleging a scheme to trade on hacked news releases. In August 2015, the SEC filed a civil action and an amended complaint in federal court in New Jersey, and the court entered an asset freeze and other emergency relief against these defendants, among others.
The SEC’s amended complaint alleges that Amaryan and several affiliated entities, Copperstone Alpha Fund, Copperstone Capital, Intertrade, and Ocean Prime, made approximately $8.1 million buying and selling stock on the basis of hacked press releases stolen from two newswire services between 2010 and 2014, and made additional profits trading on press releases stolen from a third newswire service in 2015.
The complaint also claims that Guibor and Omega 26 participated in the same scheme and made approximately $3.5 million and $3.1 million respectively, and made additional profits trading on press releases stolen in 2015.
Without admitting or denying the allegations in the SEC’s complaint, each of the defendants agreed to be permanently enjoined from violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder and Section 17(a) of the Securities Act of 1933 and pay disgorgement as follows: $10 million jointly for the Amaryan Defendants, $4.2 million for Guibor, and $3.72 million for Omega 26.
For further information about this securities law blog post, please contact Brenda Hamilton, Securities Attorney at 101 Plaza Real S, Suite 202 N, Boca Raton, Florida, (561) 416-8956, by email at [email protected] or visit www.securitieslawyer101.com. This securities law blog post is provided as a general informational service to clients and friends of Hamilton & Associates Law Group and should not be construed as, and does not constitute legal advice on any specific matter, nor does this message create an attorney-client relationship. Please note that the prior results discussed herein do not guarantee similar outcomes.