Email this Document!
Press Release For Immediate Release July 25, 2003	U.S. Department of Justice United States Attorney District of New Jersey Christopher J. Christie 970 Broad Street, Seventh Floor Newark, New Jersey 07102 Contact: Scott S. Christie Assistant U.S. Attorney (973) 645-2884 Michael Drewniak, PAO (973) 645-3657 Fax: (973) 645-2888

 

Russian Hacker Sentenced to Four Years in Prison for Supervising Criminal Enterprise Dedicated to Computer Hacking, Fraud and Extortion and Victimizing Glen Rock Financial Services Company

NEWARK – Late yesterday afternoon, at the federal courthouse in Hartford, Connecticut, a Russian computer hacker was sentenced to a prison term of four years for supervising a criminal enterprise in Russia dedicated to computer hacking, fraud and extortion which victimized a Glen Rock financial services company, U.S. Attorney Christopher J. Christie announced.

Aleksey V. Ivanov, 23, formerly of Chelyabinsk, Russia, was sentenced by U.S. District Judge Alvin W. Thompson to a term of imprisonment of 48 months, capping a joint prosecution involving the U.S. Attorneys Offices in New Jersey; Connecticut; Seattle; and Los Angeles and Sacramento, Calif.

In August 2002, Ivanov pleaded guilty before Judge Thompson to multiple counts of conspiracy, computer hacking, computer fraud, credit card fraud, wire fraud, and Hobbs Act extortion. At that time, Ivanov pleaded guilty to a one-count Information in New Jersey charging computer fraud, according to Assistant U.S. Attorney Scott S. Christie.

The New Jersey charge stemmed from Ivanov hacking into the computer system of Financial Services, Inc. ("FSI"), an Internet web hosting and electronic banking processing company located in Glen Rock on March 22, 2000, and stealing 11 passwords used by FSI employees to access the FSI computer network and a text file containing approximately 3,500 credit card numbers and associated card holder information for FSI customers.

According to the Information, an unnamed confederate of Ivanov thereafter threatened FSI that the hacker group would publically release this stolen credit card information and hack into and cause damage to the FSI computer system unless FSI paid $6,000. After a period of negotiation, FSI eventually agreed to pay $5,000. During April and May 2000, at the direction of this confederate of Ivanov, FSI wired a total of $5,000 to a bank account at Alfabank in Moscow, Russia.

In sentencing Ivanov, Judge Thompson described his participation as a "manager or supervisor" in an "unprecedented, wide-ranging, organized criminal enterprise" that "engaged in numerous acts of fraud, extortion, and intentional damage to the property of others, involving the sophisticated manipulation of computer data, financial information, and credit card numbers." He found that Ivanov was responsible for an aggregate loss to his victims of approximately $25 million.

Ivanov and Vasiliy Gorshkov, an associate, were arrested in Seattle on November 10, 2000, after being lured to the United States as part of an FBI undercover investigation. Ivanov and Gorshkov, who was convicted of similar charges in Seattle and sentenced on Oct. 4, 2002 to three years in prison, came to the United States for what they believed to be a "job interview" with Seattle-based computer security company called Invita. Invita, however, was an undercover FBI company that allowed investigators to obtain evidence needed to charge the two Russians. Ivanov remained in continuous custody during his prosecution.

U.S. Attorney Christopher J. Christie noted that this case highlights the international character of computer hacking and praised the coordinated investigation of FBI offices across the country and the joint prosecution effort of the five U.S. Attorneys Offices.

"The Internet is a world full of information, entertainment, and commerce," the U.S. Attorney said. "At the same time, this case illustrates the hazards of the Internet and its vulnerability as a tool for fraud and theft."

U.S. Attorney Christie credited Special Agents of the FBI, under the direction of Special Agent in Charge Louie F. Allen in Newark, with developing the case against Ivanov. The case was prosecuted by Assistant U.S. Attorney Christie of the U.S. Attorney's Computer Hacking and Intellectual Property Section in Newark; Assistant U.S. Attorneys Mark G. Califano and Shawn J. Chen of the District of Connecticut; Assistant U.S. Attorneys Stephen Schroeder and Floyd Short of Western District of Washington; Assistant U.S. Attorney Arif Alikhan of the Central District of California; and Assistant U.S. Attorney Mark Krotoski of the Eastern District of California.

-30-

Defense Attorney:

C. Thomas Furniss, Esq. Hartford, CT

###

• More information on: Ivanov's sentence (D.Conn press release)
• More information on: Ivanov's charges in Connecticut
• More information on:  Ivanov's charges in Santa Ana, California
• More information on:  Ivanov's charges in Sacramento, California
• More information on:  Gorshkov's Sentence
• More information on:  Gorshkov's Conviction
• More information on:  Computer Crime
• More information on:  Computer Crime Cases

 

Go to . . . CCIPS Home Page  || Justice Department Home Page