(Adds details of settlement and allegations, comments, casecitation, byline)
By Jonathan Stempel
Sept 14 (Reuters) - Two defendants agreed to pay $30 millionto settle U.S. Securities and Exchange Commission civil insidertrading charges over a scheme to hack into networks thatdistribute corporate news releases, the regulator said onMonday.
Jaspen Capital Partners Ltd and Chief Executive AndriySupranonok, both from Kiev, Ukraine, are the first of 34defendants to settle SEC charges over allegations of the theftof more than 150,000 press releases from Business Wire,Marketwired and PR Newswire before the news became public.
The SEC said the scheme resulted in more than $100 millionof illegal profit over a roughly five-year period.
Authorities said traders would give hackers "shopping lists"of press releases they wanted to see in advance, and then maketrades based on them. Nine of the defendants also face criminalcharges. Jaspen and Supranonok were not criminally charged.
The SEC said Jaspen and Supranonok usedcontracts-for-differences, which are derivatives allowing forleveraged stock price bets, to trade from 2010 to 2015 in PaneraBread Co, RadioShack Corp and other companies based onpress releases stolen from the three newswires.
Without admitting wrongdoing, the defendants agreed totransfer $30 million of ill-gotten gains from frozen brokerageaccounts, the SEC said. The accord requires court approval.
"Today's settlement demonstrates that even those beyond ourborders who trade on stolen nonpublic information and usecomplex instruments in an attempt to avoid detection willultimately be caught," SEC enforcement chief Andrew Ceresneysaid in a statement.
A lawyer for Jaspen and Supranonok did not immediatelyrespond to requests for comment. The SEC said its civil casewill continue against the other 32 defendants.
Business Wire is a unit of Warren Buffett's BerkshireHathaway Inc, and PR Newswire is a unit of Britain'sUBM Plc.
The case is SEC v Dubovoy et al, U.S. District Court,District of New Jersey, No. 15-06076. (Reporting by Jonathan Stempel in New York; Editing by ChrisReese and Grant McCool)
