The Ultimate Hack - HFT Hedge Fund's Trades "Slowed Down" By Malicious Malware

Tyler Durden's picture




 

UPDATE: Sure enough, this was serious! *FBI, N.Y. POLICE ANNOUNCE FINANCIAL CYBER CRIMES TASK FORCE

Hacking Target... or The Pentagon... or Alcoa... or some Chinese military installation is all well and good; but mess with the US equity markets' mainstay market structure and it's getting serious. As BAE Systems reports, hackers slowed down high-speed trading at a large hedge fund last year and rerouted information about the company’s trades to offsite computers. The cyber-attack targeted the hedge fund’s trade order entry system and added gaps to the company’s trading algorithm - delaying orders by milliseconds. The hack went undetected for 8 weeks.  Though the hedge fund was not named, it is believed that 'organized crime' is behind the hack - ironic really...

 

As Bloomberg reports,

Hackers rerouted information about a hedge fund’s high-speed trades last year to offsite computers, a security official with BAE Systems Plc said.

 

The hackers sought out monetary gain, targeting the hedge fund’s trade order entry system and adding gaps to the company’s trading algorithm, Paul Henninger, global product director at BAE Systems Applied Intelligence, said in an interview.

 

The attack slowed down high-speed trading at the hedge fund, which BAE wouldn’t name.

 

“This is the first time we’ve seen criminals actively go after a business system and effectively take over that system and create sabotage,” said Paul Henninger, global product director for BAE Systems Applied Intelligence.

 

The attack was going on for eight weeks and BAE was called in by the company at the end of 2013, Henninger said.

 

“It has all the signatures of an organized crime attack,” he said.

 

  • *HACKERS PENETRATED A LARGE HEDGE FUND, BAE SYSTEMS TELLS CNBC
  • *BAE SAYS HACKERS STALLED HIGH-SPEED TRADES AT FUND: CNBC
  • *ATTACKS DELAYED TRADES BY MILLISECONDS, BAE'S HENNINGER SAYS
  • *HACKERS SAID TO SEEK MONETARY GAIN IN ATTACK ON HEDGE FUND: BAE
  • *HEDGE FUND HAD TRADING SLOWED BY HACKERS IN 2013, BAE SAYS
  • *HACKERS REROUTED HIGH-SPEED TRADING INFORMATION, BAE SAYS
  • *ATTACK ON HEDGE FUND WENT UNDETECTED FOR EIGHT WEEKS, BAE SAYS
  • *ORGANIZED CRIME SAID TO BE BEHIND HEDGE FUND HACKER ATTACK

 

What better way to crash a stock market than to hack the HFTs?

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Thu, 06/19/2014 - 11:16 | 4873776 order66
order66's picture

Awesome.

Thu, 06/19/2014 - 11:17 | 4873780 PartysOver
PartysOver's picture

Now that is rich.

Thu, 06/19/2014 - 11:20 | 4873798 gh0atrider
gh0atrider's picture

Good!  Root them, crash them...

Thu, 06/19/2014 - 11:23 | 4873809 Pool Shark
Pool Shark's picture

 

 

*ORGANIZED CRIME SAID TO BE BEHIND HEDGE FUND HACKER ATTACK

"Don't kid yourself Marty; it's not that organized."

http://www.youtube.com/watch?v=coDtzN6bXAM

Thu, 06/19/2014 - 11:28 | 4873823 maskone909
maskone909's picture

fellas, i dont know about you, but this feels like things are beggining to boil over. 

Thu, 06/19/2014 - 11:32 | 4873845 pods
pods's picture

It was just Time Warner throttling their bandwith after getting tired of all the HFT ping pong going on sucking up bandwidth.

pods

Thu, 06/19/2014 - 11:48 | 4873921 max2205
max2205's picture

What? Fish in wrappers is no longer effective

Thu, 06/19/2014 - 12:10 | 4873989 ACP
ACP's picture

Wait a minute, you mean to tell me the money we are robbing is being robbed? We went to all that trouble and someone is stealing from us?!

Thu, 06/19/2014 - 12:15 | 4874014 Pool Shark
Pool Shark's picture

 

 

"Bloody Pirates!!!"

http://www.youtube.com/watch?v=PE3K3Z13Uww

 

Thu, 06/19/2014 - 12:56 | 4874225 redpill
redpill's picture

Now you know how retail investors feel, fuckers!

Thu, 06/19/2014 - 13:35 | 4874428 WillyGroper
WillyGroper's picture

Since the market isn't rigged, just WTF is the problem?

Organized crime stealing from organized crime?

I repeat myself, just WTF is the problem?

Can you discern which one is which?

Thu, 06/19/2014 - 15:52 | 4875022 MagicHandPuppet
MagicHandPuppet's picture

I've alway hated (all) malware.... until now

Thu, 06/19/2014 - 15:53 | 4875023 MagicHandPuppet
MagicHandPuppet's picture

I heart anonymous

Thu, 06/19/2014 - 11:33 | 4873846 Divided States ...
Divided States of America's picture

I mentioned why nobody hasnt created some virus to destroy the structure of this integrity-less markets a few years ago. If HFT and algos are controlling the markets, then create a program that causes it to run haywire. It seems like this has become reality. Problem is, any stock market crash in the future maybe blamed on this and not because of economic fundamentals deteriorating or inflation running rampant.

 

Thu, 06/19/2014 - 12:08 | 4873916 Skateboarder
Skateboarder's picture

That's even more unbelievable than a bunch of cave-dwellers taking down big skyscrapers.

edit: Jesus, and so swallowable of a story for a world population accustomed to teevee stories, heroes, and villians. It's so obscene, it can't not happen.

Thu, 06/19/2014 - 12:29 | 4874073 optimator
optimator's picture

The next crash wil big'un, and the Little Guy will be locked out of trading while the 1% take their profts out.

Thu, 06/19/2014 - 11:33 | 4873850 Grande Tetons
Grande Tetons's picture

I felt that way last year.  TBTB seem to have an endless supply of assholes and rabbits. 

Thu, 06/19/2014 - 11:35 | 4873863 Jam Akin
Jam Akin's picture

One huge gaping asshole, infinite supply of rabbits.

Thu, 06/19/2014 - 11:38 | 4873889 Grande Tetons
Grande Tetons's picture

....so much for my Chocolate Doughnut today.

Thu, 06/19/2014 - 11:48 | 4873918 Bindar Dundat
Bindar Dundat's picture

Organized crime? You mean the Feds , don't you?

Thu, 06/19/2014 - 11:34 | 4873855 ebworthen
ebworthen's picture

Gives "ethical hacking" a new meaning.

Thu, 06/19/2014 - 12:16 | 4874019 KnuckleDragger-X
KnuckleDragger-X's picture

But isnt organized crime the ones running the HFT scheme?

Thu, 06/19/2014 - 12:17 | 4874024 DetectiveStern
DetectiveStern's picture

Fairly certain another HFT firm did it.

 

Be quicker, smarter or cheat remember.

Thu, 06/19/2014 - 14:58 | 4874791 Bunga Bunga
Bunga Bunga's picture

Fixed it for you:

*ORGANIZED CRIME SAID TO BE BEHIND HEDGE FUND

Thu, 06/19/2014 - 13:56 | 4874528 sgt_doom
sgt_doom's picture

No comment . . .

Thu, 06/19/2014 - 11:18 | 4873782 Pool Shark
Pool Shark's picture

 

 

For once the High Freaks had to trade just like us "little people."

HUZZAH!!!

 

Thu, 06/19/2014 - 12:40 | 4874116 cougar_w
cougar_w's picture

It's called "clearing the market"

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Thu, 06/19/2014 - 11:17 | 4873785 Awakened Sheeple
Awakened Sheeple's picture

Ok guys. Which one of you did it?

Thu, 06/19/2014 - 11:38 | 4873882 Headbanger
Headbanger's picture

I can't tell you but I heard his initials are.. 

Thu, 06/19/2014 - 11:48 | 4873922 0b1knob
0b1knob's picture

It was John Galt who did the deed...

Thu, 06/19/2014 - 11:19 | 4873791 ISEEIT
ISEEIT's picture

'organized crime' is behind the hack .......

 

No shit? The USG hacked a HFT gangs system huh?

Must have been on somebodies shitlist.

Thu, 06/19/2014 - 11:19 | 4873794 Reaper
Reaper's picture

They call the pot, "organized" crime?

Thu, 06/19/2014 - 11:19 | 4873795 madbraz
madbraz's picture

The funny part is that the article associates the word "criminals" with hackers, instead of hedge funds and HFT.

Thu, 06/19/2014 - 11:24 | 4873814 sodbuster
sodbuster's picture

I thought the Fed and Wall Street, WERE the Organised Crime Syndicate.

Thu, 06/19/2014 - 11:19 | 4873796 vote_libertaria...
vote_libertarian_party's picture

What ever happened to that Russian programmer that took home that HFT code and was arrested...

Thu, 06/19/2014 - 11:32 | 4873843 JRobby
JRobby's picture

An assault on GS it was as I recall? He made the mistake of flying into EWR. He is detained indefinitely as an enemy combatant. You attack GOLDMAN, you are attacking the state.

Thu, 06/19/2014 - 11:32 | 4873844 disabledvet
disabledvet's picture

He got another job apparently.

Thu, 06/19/2014 - 11:20 | 4873800 Zerozen
Zerozen's picture

Hold on...wait...just a moment...

I'm busy looking for a microgram of a fuck to give for the plight of the HFT fund

Searching between the couch cushions now...

Thu, 06/19/2014 - 11:20 | 4873801 Bill of Rights
Thu, 06/19/2014 - 11:22 | 4873802 Oh regional Indian
Oh regional Indian's picture

Organized crime is at the heart of wall street, always has been. NYNY always stood for two things, Finance and Mafia.

They go well together, like an Apple and a Worm ;-)

Thu, 06/19/2014 - 11:21 | 4873803 dracos_ghost
dracos_ghost's picture

And how is this any different than IEX?

Thu, 06/19/2014 - 11:27 | 4873805 JenkinsLane
JenkinsLane's picture

Presumably, once this information permeates through the hacker community,

HFTs are going to come under sustained hacker attacks demanding ransoms.

After all, these guys have the most money to lose and the most money to pay.

Thu, 06/19/2014 - 11:46 | 4873914 Urban Redneck
Urban Redneck's picture

Or the high priests of the Kremlin could simply have the FSB pass the word-

fucking with the "little people" and their credit cards, as opposed to Western HFT/Banking interests is no longer an acceptable use of the benefit of the State's discretion in (non)enforcement of the cybercrime laws.

Thu, 06/19/2014 - 11:22 | 4873806 canonball
canonball's picture

Belgium did it

Thu, 06/19/2014 - 11:25 | 4873817 buzzsaw99
buzzsaw99's picture

organized crime = gollum sacks?

Thu, 06/19/2014 - 11:28 | 4873825 goldhedge
goldhedge's picture

Working for the NSA can be profitable.

Thu, 06/19/2014 - 11:28 | 4873828 The Duke of New...
The Duke of New York A No.1's picture

Let me guess; the Hedge Fund specialized in naked shorting Russian & Chinese CDS.

Thu, 06/19/2014 - 14:59 | 4874800 Bunga Bunga
Bunga Bunga's picture

Nope, just shorting your 401k.

Thu, 06/19/2014 - 11:29 | 4873831 buzzsaw99
buzzsaw99's picture

They got the money, hey

You know they got away

They headed down south and they're still running today

Singin' go on take the money and run...

Thu, 06/19/2014 - 11:31 | 4873839 ptoemmes
ptoemmes's picture

Organized Crime Terrorists - OCT - fixed it a bit.

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