An IT consultant who hacked into the WiFi network of Australian financial publisher Port Phillip Publishing (PPP) to engage in insider trading has been sentenced to three-years in prison.
Between January 2012 and February 2016, Oakes loitered in the vicinity of PPP’s offices, intecepting and decrypting Wifi data to obtain the network login credentials of PPP staff.
In this way he was able to pick up buy recommendations for shares in particular ASX listed companies from unpublished PPP stock recommendation reports. The publication of a buy recommendation by PPP for a particular company typically caused an increase in that company’s share price.
Oakes used this inside information on 70 occasions to buy shares in 52 different companies, before the reports with the buy recommendations were published.
Oakes was arrested after a forensic investigation of his electronic devices by the Australian Securities and Investment Commission (Asic).
Asic Commissioner Cathie Armour says: "Technology-enabled offending, including cyber-related market misconduct, has been a priority for Asic’s Enforcement teams. Despite the sophistication of cyber criminals, Asic can identify and investigate suspicious market activity connected to computer hacking activities, as it did in the case against Mr Oakes. Traders should be aware that Asic continues to focus on cyber-related offending."
In sentecing, the judge said Oakes was "motivated by greed", that "insider trading is a form of cheating. It is not a victimless crime", and stressed that "if you access a secure computer network to commit a crime, you should expect to go to jail".