The Securities and Exchange Commission announced settlements against two traders who allegedly profited from trading on nonpublic corporate earnings information hacked from the agency’s Electronic Data Gathering, Analysis and Retrieval (EDGAR) system for public company filings.
The settlements against David Kwon and Igor Sabodakha for using nonpublic documents containing earnings announcements of publicly traded companies for illegal trading are subject to court approval.
According to the SEC’s complaint, Kwon, of California, Sabodakha, of Ukraine, and seven other defendants participated in the scheme.
The SEC announced charges against the nine individuals on Jan. 19.
The complaint alleged that a Ukrainian hacker extracted EDGAR files containing nonpublic earnings results.
Kwon and Sabodakha allegedly traded on the basis of this hacked information before the earnings were released to the public.