By Nate Raymond
BOSTON, Jan 30 (Reuters) - A wealthy Russian businessman
with ties to the Kremlin faces trial on Monday on U.S. charges
that he participated in a vast scheme that generated tens of
millions of dollars in illegal trading profits using corporate
information stolen through hacking.
Jury selection is scheduled to begin in federal court in
Boston in the case of Vladislav Klyushin, 42, who before his
arrest in Switzerland in 2021 owned a Moscow-based information
technology company with ties to the Russian government.
The three-week trial comes at a low point in U.S.-Russia
relations following Russian President Vladimir Putin's invasion
of Ukraine last year. And while the case against Klyushin, who
has pleaded not guilty, predates the war, his connections to the
Kremlin have long intrigued U.S. authorities.
Prosecutors say Klyushin's company, M-13, not only did work
for Putin's administration but also employed a former Russian
military intelligence officer wanted by the U.S. government for
his alleged involvement in hacking schemes aimed at interfering
in the 2016 U.S. presidential election.
His lawyer in the Swiss extradition proceedings, Oliver
Ciric, has said the real reason Klyushin was sought was his
Russian government ties and that U.S. and British intelligence
agencies earlier tried to recruit him.
U.S. authorities say the hacker, Ivan Ermakov, while working
for Klyushin helped infiltrate the networks of two firms that
help publicly traded companies file reports with securities
regulators to download yet-to-be-announced financial reports.
Using those stolen earnings reports, Klyushin, Ermakov and
three others from 2018 to 2020 agreed to buy and sell stocks for
multiple companies including IBM Corp , Snap Inc and Tesla Inc , allowing them to make at least $89
million, prosecutors say.
Klyushin's lawyers say he was already wealthy before the
alleged conduct occurred and that the government's evidence
linking any trades he placed to the hacked information suffers
from "serious flaws."
He has been held without bail since his extradition from
Switzerland, with a judge citing his wealth and assets including
a nearly $4 million yacht, which prosecutors say he discussed
buying at the same time the trading scheme unfolded.
Prosecutors plan to show jurors a photo of the yacht, though
U.S. District Judge Patti Saris last week barred them from
presenting more pictures of it to avoid "the prejudice of 'here
is a super rich oligarch.'"
(Reporting by Nate Raymond in Boston; Editing by Alexia
Garamfalvi and Daniel Wallis)
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nate.raymond.thomsonreuters.com@reuters.net))
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