According to a Monday report in Bloomberg News, Vladislav Klyushin was extradited to the U.S. on insider trading charges in December, but IT executive and Russian-intelligence insider could help the U.S. government crack open Russian hacking into the 2016 presidential election.
Sources close to the Russian government said he was the highest level of Kremlin insider handed over to U.S. law enforcement in recent memory, who received a medal of honor from Russian president Vladimir Putin just 18 months ago.
The Russian intelligence has concluded that Klyushin has access to documents related to Russia's campaign to hack into the Democratic Party's servers in 2016 and the subsequent attempt to leak damaging information to the press in an effort to bolster Donald Trump's chances of winning the presidency that year. The documents would establish that the hack was led by Russian military intelligence, giving the U.S. its best documentary evidence yet that the Russian government was directly involved in the hack.
Michael McFaul, a former U.S. ambassador to Russia under President Barack Obama, told Bloomberg that they were seeing signs that they are continuing to pursue this case, with real big implications for exposing what the Russians did to influence the outcome of our election.
He said that Klyushin's extradition is a serious concern for the Russian government and underscores the risk that anyone, billionaires or others close to the Russian state, will face when they break American law if they travel abroad. Klyushin was extradited from Switzerland to the U.S. on December 18 for wire fraud, securities fraud and unauthorized access to computers, along with five other Russian nationals, including Ivan Ermakov, who was also charged in 2018 by U.S. Special Counsel Robert Mueller's investigation into the 2016 hack.
The charging documents say Klyushin and his associates stole nonpublic information from the computer networks of two vendors used by public companies to make quarterly and annual filings to the SEC, and then traded on that information between January of 2018 and September of 2020. Klyushin and his co-conspirators earned tens of millions of dollars in illegal trades, the Department of Justice said.
The hackers have access to compromised vendors and downloaded the earnings results of several companies, including Tesla Inc., TSLA, International Business Machines Corp., IBM, Snap Inc. The Justice Department said that SNAP and Microsoft Corp. MSFT were days before the earnings results were announced to the public.
The hackers then traded short the shares of companies that were due to announce disappointing results, and buying shares of companies whose earnings were better than expected.
Klyushin is scheduled to be arraigned on these charges Monday, and his U.S. based lawyer Maksim Nemtsev wrote in his bail application that his client intends to challenge the government's case in a lawful, professional and principled manner. The Russian government's reaction to Klyushin's extradition suggests that it is concerned that he will trade state secrets in exchange for leniency from the U.S. government. Oliver Ciric, a Switzerland-based attorney, told Bloomberg that U.S. and British officials tried to recruit him twice in 2019 and 2020.
Russia submitted a request for extradition for Klyushin in an attempt to make an end to U.S. extradition, a strategy it has used in past instances when unfriendly countries have accused citizens of crimes abroad. After a summit between President Joe Biden and Putin in June, Russia tried to bargain for his release by offering the release of two former U.S. marines, Paul Whelan and Trevor Reed, according to Bloomberg.