South Florida Arbitration & Litigation Lawyer Blog
Unregistered Investment Advisor and Broker/Dealer Investment Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney, Russell L. Forkey, Esq.
April, 2012:
SEC v. Petr Murmylyuk, Civil Action No. 12-cv-2272-CCC (D.N.J.)
SEC Charges Petr Murmylyuk with Fraudulent Brokerage Account Intrusion Scheme
The Securities and Exchange Commission recently announced that it filed a civil action in the United States District Court for the District of New Jersey against Petr Murmylyuk (“Murmylyuk”), a Russian citizen residing in Brooklyn, New York.
The Commission alleges that, on November 1, 2011, Murmylyuk engaged in an online account intrusion scheme in which he stole money from an unsuspecting victim by illegally intruding into the victim’s online brokerage account and fraudulently causing that account to engage in unauthorized options trading with another online brokerage account that Murmylyuk controlled, and which was opened under a fictitious name using a stolen social security number. Essentially, Murmylyuk entered matching orders in those accounts that caused the intruded victim account first to purchase thinly traded options from Murmylyuk’s stolen identity account at a high price, and then to immediately sell the same options back to the stolen identity account at a much lower price, resulting in a profit to Murmylyuk’s stolen identity account and a loss to the intruded victim account. In total, Murmylyuk’s fraudulent trading on November 1, 2011 generated illegal profits of more than $30,000 for his stolen identity account, and losses of more than $140,000 for the intruded victim account.
The Commission’s complaint charges Murmylyuk with violating Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and seeks a final judgment order permanently enjoining him from violating those provisions of the federal securities laws and ordering him to disgorge his ill-gotten gains plus prejudgment interest and pay a civil penalty. Criminal charges have also been filed against Murmylyuk in a parallel criminal case.