Last Tuesday, New Jersey Federal prosecutors charged three men in a $2 million identity theft scheme to hack corporate computer systems and send spam messages to more than 60 million employees.
The three men, (Tomasz Chmielarz , Devin James McArthur , Timothy Edward Livingston ) were charged with conspiracy to commit fraud in connection with computers as well as conspiracy to commit wire fraud. Chmielarz and Livingston were additionally charged with fraud and related activity in connection with electronic mail.
The defendants face a penalty of up to 20 years in prison and $250,000 in fines on wire fraud charges as well as up to five years in prison and $250,000 in fines on the email and computer conspiracy charges.
Livingston has almost $300,000 in his Wells Fargo bank account in both his name and the corporate name, both of which are subject to forfeiture, and his 2006 Ferrari F430 Spider Convertible and 2009 Cadillac Escalade have both been seized.
No one has yet pleaded guilty, and Chmielarz’ attorney has informed the press that Chmielarz plans to plead not guilty.
According to prosecutors, Livingston and others started a company called “A Whole Lot of Nothing” in 2011. The company sent spam email on behalf of its clients.
A Whole Lot of Nothing was a successful enterprise and worked with clients ranging from legitimate businesses to illegal pharmacies that sold narcotics without a prescription. The company made money by charging from $5 to $9 for every email that led to a successful transaction.
The victims of this service included unnamed telecommunications firms and technology and consulting firms in New York, Texas and Pennsylvania.
When the ISPs started using software to block the spam messages, prosecutors said that Livingston paid Chmielarz to write computer programs that allowed for the identity of the sender to be concealed and thus for the emails to bypass the software.
According to prosecutors, the two mean are accused of using proxy servers to send out spam and using botnets to avoid spam blockers. They’re also accused of hacking into individual accounts and using them to send more spam emails.
The third defendant enters the picture when the three teamed up to steal confidential information of corporate victims, including databases containing the personally identifiable information of millions of Americans. McArthur allegedly provided Livingston with access to a remote administration tool that allowed him to steal data and contact information from that company.
Unfortunately for internet users, spam messages are among the most prevalent and effective ways of accessing personal data. An average of 1.5 million deceptive emails are sent on a daily basis, especially to business users.
According to GreatHorn CEO Kevin O’Brien, “This problem isn’t only pervasive; it’s also incredibly effective… Over 90 percent of all known data breaches start with this kind of attack.”
The attacks can cost companies millions of dollars, especially if the chief financial officer is targeted.
The country’s growing frustration with these cyberattacks does not bode well for these three accused hackers; if they are found guilty, the judge and jury are likely to make them pay for their spam emails.