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ITMG Insider Threat Cases – January 4, 2021


Ticketmaster fined $10 million in corporate espionage scheme

The Department of Justice announced Wednesday Ticketmaster would pay a $10 million fine as part of a differed prosecution agreement for using an employee’s login credentials to his former employer’s computer systems to garner information on the competitor. Zeeshan Zaidi, the former head of artist services at Ticketmaster, pled guilty to conspiring to commit computer intrusions and wire fraud in October 2019. Ticketmaster, a subsidiary of LiveNation, is a leading provider of live event ticket sales. Much of its business comes from exclusive deals with major artists for the presale of concert tickets. In the computer intrusion scheme detailed in the agreement, Ticketmaster tried to steal both a client and design ideas from a competitor by logging into the competitor’s back-end system. The former employee also stole the competitor’s fee calculation system in the form of an Excel spreadsheet.

Ticketmaster Pays $10 Million Criminal Fine for Intrusions into Competitor’s Computer Systems: Ticketmaster Used Passwords Unlawfully Retained by a Former Employee of a Competitor to Access Computer Systems in Scheme to “Choke Off” the Victim’s Business (DOJ Press Release)

Earlier today in federal court in Brooklyn, Ticketmaster L.L.C. (Ticketmaster or the Company) agreed to pay a $10 million fine to resolve charges that it repeatedly accessed without authorization the computer systems of a competitor.  The fine is part of a deferred prosecution agreement that Ticketmaster has entered with the United States Attorney’s Office for the Eastern District of New York to resolve a five-count criminal information filed today charging computer intrusion and fraud offenses.  Previously, on October 18, 2019, Zeeshan Zaidi, the former head of Ticketmaster’s Artist Services division, pled guilty in a related case to conspiring to commit computer intrusions and wire fraud based on his participation in the same scheme.  Both cases are assigned to U.S. District Judge Margo K. Brodie.

Two Men Charged in Conspiracy to Steal Computer Equipment From Chicago Company

CHICAGO —An employee of a Chicago company conspired with a New Jersey man to steal computer equipment from the company and sell it to businesses in California and Texas, according to charges in a federal indictment. DONALD WILSON worked for the Chicago company as a data center engineer.  From 2015 to 2018, Wilson conspired with IVAN SIERRA to steal computer servers, hard drives, and other information technology equipment from the company’s facilities in Chicago and Secaucus, N.J., the indictment states.  Sierra then worked to sell the stolen equipment to businesses in Chatsworth, Calif., and Stafford, Texas, for a total of more than $500,000 the indictment states. The indictment was returned Thursday in federal court in Chicago.  It charges Wilson, 42, of Carol Stream, Ill., and Sierra, 38, of Lincroft, N.J., with one count of conspiracy to transport stolen goods, and two counts of transportation of stolen goods.  Arraignments have not yet been scheduled.

The Top 5 U.S. Espionage Cases of 2020

The year 2020, was a year steeped with several espionage cases coming to light. As expected, China and Russia compromised the top five cases in which a nation state targeted the United States using espionage to acquire information and technological know-how. These cases are: #5 CHINA’S THOUSAND TALENT PROGRAM – Throughout 2020 the successful penetration of a plethora of U.S. academic and research entities was made by China througfh their Thousand Talents Program. This program identified individuals who were conducting research that was of interest to China. An approach was made to allow for the assessment and subsequent covert collaboration on the research, much of it conducted on the U.S. government’s dime, with a Chinese entity. The recruited individual would be paid twice for the same research, once with a grant provided by the U.S. government through agencies like NIH, NASA, NSA and DoD. The researchers were paid again within the envelop of the Chinese commercial agreement.

China-Based Executive at U.S. Telecommunications Company Charged with Disrupting Video Meetings Commemorating Tiananmen Square Massacre: Defendant Coordinated with the People’s Republic of China to Target Dissidents and Disrupt Meetings

A complaint and arrest warrant were unsealed today in federal court in Brooklyn charging Xinjiang Jin, also known as “Julien Jin,” with conspiracy to commit interstate harassment and unlawful conspiracy to transfer a means of identification.  Jin, an employee of a U.S.-based telecommunications company (Company-1) who was based in the People’s Republic of China (PRC), allegedly participated in a scheme to disrupt a series of meetings in May and June 2020 held to commemorate the June 4, 1989 Tiananmen Square massacre in the PRC.  The meetings were conducted using a videoconferencing program provided by Company-1, and were organized and hosted by U.S-based individuals, including individuals residing in the Eastern District of New York.  Jin is not in U.S. custody.

Comptroller Pleads Guilty To Embezzling From Manhattan Financial Publishing Company

Audrey Strauss, the Acting United States Attorney for the Southern District of New York, announced today that ERIC IAN WHITEHEAD pled guilty to wire fraud for his role in a years-long scheme to embezzle approximately $1.3 million from a financial publishing company (the “Company”), where he was then employed as comptroller.  The plea was entered in front of U.S. District Judge Ronnie Abrams. From at least in or around 2015 through in or around 2020, WHITEHEAD used wire transfers and cash deposits from the victim Company to benefit himself without authorization from the Company.  Specifically, WHITHEAD used Company assets to pay for personal credit card expenses, overpay personal credit cards to receive cash balance refunds, write checks to cash for deposit into personal bank accounts, and purchase precious metals to sell for his own profit.  WHITEHEAD consistently embezzled Company funds from in or around 2015 through in or around 2020, for a total loss amount of approximately $1.3 million.

Former Houston Independent School District Employee Sentenced in College Admissions Case

BOSTON – A former employee of the Houston Independent School District was sentenced today in connection with her involvement in a scheme to use bribery and fraud to facilitate cheating on the ACT and SAT exams. Niki D. Williams, 46, of Houston, Texas, was sentenced by U.S. District Court Judge Indira Talwani to one year of probation and ordered to pay forfeiture of $12,500. The government recommended a sentence of six months in prison and one year of supervised release. In September 2020, Williams pleaded guilty to one count of conspiracy to commit wire fraud and mail fraud and honest services wire fraud and mail fraud. Williams administered the SAT and ACT exams at the public high school in Houston where she worked. In exchange for bribe payments directed to her by co-conspirators William “Rick” Singer and Martin Fox, and in violation of her duty of honest services to the ACT and the College Board, Williams allowed another co-conspirator, Mark Riddell, to secretly take ACT and SAT tests in place of the children of Singer’s clients or to replace their exam answers with his own corrected answers. Williams then returned the falsified exams to the ACT and College Board for scoring.

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