Cyber Incident Victim: E*Trade
Date:
Jan 2014
Location:
Australia
Summary
A Russian hacker compromised retail accounts at E*Trade and other brokerage firms to manipulate 13 Australian penny stocks, artificially inflating their prices before trading out for illicit profits totaling approximately $77,429 AUD. The scheme was uncovered through a joint investigation by Australian financial and law enforcement authorities, leading to a court order restraining the funds, though the suspect remains unidentified.
| CIA Posture | Motives | Tactics, Techniques & Procedures |
|---|---|---|
| Available to members | 1 motive | 3 techniques |
| Threat Actors | Type | Location |
|---|---|---|
| 0 actors | Available to members | Available to members |
Description
In 2015, the Australian Securities & Investments Commission (ASIC) disclosed a cyber-enabled market manipulation scheme involving compromised retail trading accounts at E*Trade, Commsec, and the Australian Investment Exchange. According to ASIC, an unnamed Russian hacker gained unauthorized access to client accounts and executed trades targeting 13 penny stocks listed on the Australian Securities Exchange (ASX) during the previous year. The attacker artificially inflated the prices of these stocks through coordinated trading activity within the compromised accounts. After creating this artificial price movement, the hacker subsequently closed the positions to realize illicit profits totaling $77,429 AUD. The scheme was detected through a joint investigation by ASIC and the Australian Federal Police (AFP), which specifically examined suspicious trades linked to an overseas account held with Morgan Stanley Australian Securities. No technical details regarding the initial account compromises were disclosed by authorities.
The investigation revealed the attacker operated by first establishing positions in targeted securities through hacked accounts, then executing trades designed to manipulate market prices upward. ASIC characterized this as deliberate creation of artificial pricing to enable profitable exit strategies. Following forensic analysis of trading patterns, Australian authorities obtained a court order to restrain the full $77,429 AUD in suspected illicit gains. Neither the specific timeframe of the trades nor the identities of affected account holders were made public. ASIC confirmed the suspect remained unnamed as of August 2015, with no public information regarding arrests or extradition proceedings. The incident demonstrated vulnerabilities in retail trading platforms being exploited for cross-border financial market manipulation, though no broader impacts on market integrity or additional compromised institutions were cited in regulatory findings.