Head of hacker-powered stock scam sent to prison
A US man was sent to prison on Monday for orchestrating a hacker-powered scam to pump up stock prices and then dump inflated shares, raking in millions of dollars.
Christopher Rad, a 44-year-old Texas resident, was described by prosecutors as the organizer of a worldwide conspiracy to cash in by using an army of virus-infected computers to manipulate stock prices.
A US federal court judge sentenced Rad to five years in prison and ordered him to pay a $30,000 fine, with restitution to be determined at a later date, according to US attorney Paul Fishman.
"Christopher Rad's use of hackers to drive his pump-and-dump scheme illustrates a trend toward the modern mechanization of old-school scams," Fishman said.
"Law enforcement is constantly anticipating and adapting as criminals operate in a more virtual - and more global - world."
Rad enlisted spammers who used networks of infected computers to unleash floods of carefully worded email messages touting stocks which he and cohorts sold after prices climbed to unworthy highs, according to prosecutors.
Hackers also broke into people's brokerage accounts and used them to buy shares of stocks to pump prices, prosecutors said.
Rad made approximately $2.8 million dollars from the "pump-and-dump" scheme between early November of 200 and the end of February 2009, according to the case against him.
© 2013 AFP