Israelis Deny Cyber-Stock Manipulation Charges

     MANHATTAN (CN) — Recently extradited from Israel, two accused hackers pleaded not guilty Thursday to charges that Manhattan’s top prosecutor called the “next frontier of securities fraud.”
     This afternoon’s hearing came seven months after federal prosecutors in New York unsealed a criminal complaint against U.S. citizen Joshua Aaron and Israeli nationals Gery Shalon and Ziv Orenstein.
     Court papers described a sophisticated securities fraud that made more than $100 million using information hacked from seven financial institutions, two newspapers, two software development companies and a market-intelligence firm.
     At the time, the Wall Street Journal reported that its parent company Dow Jones was a victim, along with JPMorgan Chase & Co., E-Trade Financial and Scotttrade, in revelations it attributed to anonymous sources.
     When U.S. Attorney Preet Bharara announced the charges last year, he said that case pointed to a “brave new world of hacking for profit.”
     Aaron remains at large, but Shalon and Orenstein were quickly arrested in Israel and extradited here within the past 24 hours.
     Together, the three men face a massive 23-count indictment with charges that include conspiracy, computer hacking, wire fraud, securities fraud and aggravated identity theft.
     Shalon and Orenstein, who are both 31, pleaded not guilty at a brief arraignment on Thursday afternoon before U.S. Magistrate Judge Kevin Fox.
     There will be a hearing before U.S. District Judge Laura Taylor Swain at 10 a.m. on Friday.

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