Devious Russian Computer Hacker Gets 4-Year Term
NEWARK, N.J. (AP) — A Russian computer hacker was sentenced to four years in federal prison for running a fraud and extortion ring that victimized dozens of financial institutions and Internet service providers.
Aleksey V. Ivanov was arrested with an accomplice after being lured to the United States by the FBI in 2000. An indictment accused them of hacking into U.S. banks and e-commerce sites, and then demanding money for not publicizing the break-ins.
Ivanov, 23, of Chelyabinsk, Russia, was sentenced Thursday by U.S. District Judge Alvin W. Thompson in Hartford, Conn., following an investigation by federal prosecutors in Hartford, Newark, Seattle and Los Angeles and Sacramento, Calif.
Ivanov pleaded guilty before Thompson in August 2002 to conspiracy, computer hacking, computer fraud, credit card fraud, wire fraud and extortion.
His cohort, Vasiliy Gorshkov, was convicted of similar charges in Seattle and was sentenced to three years in prison.
Thompson determined that Ivanov cost victims about $25 million and supervised a criminal enterprise that engaged in numerous acts of fraud and extortion by manipulating computer data and financial information, the Newark U.S. Attorney’s Office said.
The ring had dozens of victims from late 1999 through August 2000, said Assistant U.S. Attorney Scott S. Christie, of the Newark office.
He said victims included Speakeasy, an Internet service provider in Seattle; VPM Internet Services, another Internet service provider, in Folsom, Calif.; Online Information Bureau, a financial transaction clearinghouse in Vernon, Conn.; Sterling Microsystems, a computer hardware and Internet service company in Anaheim, Calif.; Goodnews Internet Service, an Internet service provider in Cincinnati; and Nara Bank, of Los Angeles.
The New Jersey fraud involved Ivanov hacking into the computer system of Financial Services Inc. of Glen Rock, a Web hosting and electronic banking processing company on March 22, 2000.
He stole 11 passwords that FSI employees used and a file with about 3,500 credit card numbers. An unidentified cohort then threatened that the hackers would release the credit card numbers and damage the FSI computer system unless FSI paid $6,000. After negotiations, FSI wired $5,000 in April and May 2000 to a Moscow bank, prosecutors said.
That November, the FBI tricked Ivanov and Gorshkov into traveling to Seattle by posing as potential customers from a mock company called Invita Computer Security. Undercover agents asked the pair for a hacking demonstration, then arrested them.
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