WEST FORSYTH — A west Forsyth man has pleaded guilty to illegally earning $125,000 as part of a $100 million insider trading scheme that involved hacking corporate press releases before they were released.
According to Reuters news service, 47-year-old Alexander Garkusha admitted guilt in federal court in Brooklyn, N.Y., in conspiring to commit wire fraud and trading on inside information by — over a three-month period — using corporate press releases obtained before they went public to make $125,000 trading in stocks.
The real estate developer was arrested in August with one other Forsyth County resident and two from nearby Alpharetta in what authorities have called the first criminal case over a securities fraud scheme involving hacked inside information, Reuters said.
Inside information was originally stolen by hackers in Ukraine. Garkusha, a U.S. citizen who was born in Russia and lives off Preserve Crossing Lane near Drew Campground and Post roads, then used the stolen information to make trades.
Garkusha agreed in his plea this week to forfeit the $125,000 he made in profits. His sentencing is scheduled for May 6.
Leonid Momotok, 47, who lives off Sugar Ridge Drive south of Windermere Golf Club, and Garkusha were taken to Hall County Jail in August.
Momotok and the two Alpharetta residents — Arkadiy Dubovoy, 51, and Igor Dubovoy, 28 — have pleaded not guilty to the federal indictments filed in Brooklyn and Newark, N.J.
The Dubovoys are scheduled to face trial next October, according to Reuters.
Wire fraud and securities fraud, the most serious charges in the indictments, carry up to 20 years in prison and fines ranging from $250,000 to $5 million.
This group of co-defendants, which also includes Vitaly Korchevsky, is accused of making $30 million in the larger scheme.
A total of nine people — including two Ukrainian computer backers and six stock traders — were indicted, and 34 defendants were named in the lawsuit by U.S. securities regulators.
The scheme reportedly used 800 of the 150,000 press releases stolen from Business Wire, Marketwired and PR Newswire between 2010-15.