A wealthy Russian businessman and associates made tens of millions of dollars by cheating the stock market in an elaborate scheme that involved hacking into U.S. computer networks to steal insider information about companies such as Microsoft and Tesla, a prosecutor told jurors on Monday.
Vladislav Klyushin, the owner a Moscow-based information technology company with ties to the upper levels of the Russian government, is standing in trial in a Boston federal court nearly two years after he was arrested after landing in Switzerland on a private jet for a skiing trip.
He’s the only Russian national charged in the nearly $90 million scheme who has been arrested and extradited to the U.S.; four accused co-conspirators — including a Russian military intelligence officer who’s also been charged with meddling in the 2016 presidential election — remain at large.
Assistant U.S. Attorney Stephen Frank told jurors that the hack-to-trade scheme netted Klyushin and his associates the kind of returns “actual money managers couldn’t even dream about.” Using stolen information about the performance of a company that would dictate its stock price, Klyushin personally turned a $2 million investment into nearly $21 million, and together, the group turned about $9 million into nearly $90 million, Frank said.
“It wasn’t luck. And it wasn’t because of careful financial research either. The defendant cheated,” Frank said.
Klyushin’s attorney told jurors that the government’s case is filled with “gaping holes” and “inferences.” He said his client was financially successful long before he began trading stocks and he continued trading in many of the same companies even after access to the alleged insider information was shut off because the hacks were discovered.
“There’s nothing illegal about being Russian, about having wealth, about having an IT company that contr ..
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