The US Securities and Exchange Commission is pressing charges against nine defendants for participating in a scheme to hack into its EDGAR system and extract confidential information to use for illegal trading.

The regulator reckons the hackers' illegal profits from trading to be $4,135,015 in all. It has charged a Ukrainian whom it describes as a hacker, six traders in California, the Ukraine and Russia, and two organisations. The alleged hacker and some of the traders were also involved in a similar scheme to hack into newswire services and trade on information that had not yet been released to the public. The SEC says that t charged the hacker and other traders for that conduct in 2015.

The SEC’s complaint alleges that after hacking the newswire services, Ukrainian Oleksandr Ieremenko turned his attention to EDGAR and gained access in 2016. Ieremenko allegedly extracted EDGAR files containing 'non-public' earnings results. He, or a confederate, then allegedly passed the information to people who used it to trade in the narrow window between the moment when he copied the files from the SEC systems and the time when the companies released the information to the public. In total, the traders traded before at least 157 earnings releases between May and October 2016 and generated some illegal profits.

The SEC says that the defendants used an offshore entity and nominee accounts to place trades. It alleges that Ieremenko cleverly obtained confidential 'test files,' which issuers sometimes submit before sending in their official reports to help make sure that EDGAR will process the filings as intended. These sometimes contained 'non-public' information (a phrase from America's insider dealing laws) in test filings, such as actual quarterly earnings results that the public had not yet seen. Ieremenko then allegedly passed the information on to the three groups of traders.