A 35-year-old resident of Chennai has pleaded guilty to conspiracy and aggravated identity theft charges in connection with an international fraud scheme to hack into online brokerage accounts in the United States and use those to manipulate stock prices.
Jaisankar Marimuthu, who was extradited to the US for trial, pleaded guilty on Friday to one count of conspiracy to commit wire fraud, securities fraud, computer fraud and aggravated identity theft, and to one count of aggravated identity theft before US District Magistrate Judge FA Gossett III in Omaha, Nebraska.
Marimuthu, who was arrested in Hong Kong, faces up to seven years in prison, a maximum fine of $500,000 and three years of supervised release following his prison term.
According to the indictment, Marimuthu was part of a conspiracy operated out of Thailand and India from February 2006 through December 2006 during which the prices of thinly traded securities were fraudulently inflated by hacking into brokerage accounts in the United States and then illegally using the accounts to make large unauthorised purchases of securities in the name of unsuspecting customers.
After the price of the securities had been artificially increased through the bogus trading, Marimuthu admitted that the conspirators' own holdings of the securities would be sold at a profit.
At least 95 customers and nine brokerage firms in the United States have been identified as victims.
Co-defendant Thirugnanam Ramanathan, 37, pleaded guilty on June 2, 2008, to one count of conspiracy to commit wire fraud, securities fraud, computer fraud and aggravated identity theft.
Co-defendant Chockalingham Ramanathan, 36, who remains at large, has been charged on one count of conspiracy, eight counts of computer fraud, six counts of wire fraud, two counts of securities fraud and six counts of aggravated identity theft.
Sentencing for Marimuthu has been set for April 26, 2010, before US District Court Judge Laurie Smith Camp.
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