Three Chinese nationals were criminally and civilly charged with a multi-million dollar cyber fraud by the US Securities and Exchange Commission (SEC) for allegedly hacking into the networks of several law firms in New York that advise companies on mergers and acquisitions.

The three Chinese citizens, Lat Hong, Bo Zheng, and Hung Chin, are facing a 13-count criminal indictment in a federal court after making $4 million in less than two years by using the information they stole to trade stocks of companies up for acquisition.

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All three accused are currently on the lam, but reports said one of them, Lat Hong, has been caught by the Hong Kong police on Christmas day and would soon be extradited to the US.

Federal Crimes

According to the SEC, the three Chinese men have been likewise charged with a list of federal crimes such as wire fraud, insider trading, computer intrusion, and conspiracy to commit fraud.

"This case of cyber meets securities fraud should serve as a wake-up call for law firms around the world: You are and will be targets of cyber hacking, because you have information valuable to would-be criminals," Manhattan US Attorney Preet Bharara said in a statement posted on the Department of Justice website.

The law firms whose networks have been hacked have not been named as of press time, but prosecutors have identified the law offices of Cravath, Swaine and Moore, and Weil, Gotshal & Manges as those hacked earlier this year.

According to the charges, the perpetrators targeted seven law firms between April 2014 and late 2015 but successfully hacked only two law firms and stole insider information from their computers.

After that, the accused allegedly used the information they purloined to buy stocks in certain companies that were pegged for acquisition and which increased in value when the deal announcements were made, making over $4 million in the process.

The three Chinese nationals, Hong, 26, and Hung, 50, are residents of Macau, while Zheng, 30, is a resident of Changsa, China. All three are facing a total of 13 counts of cyber hacking in the New York court.

The indictment added that the three men had tried more than 100,000 times to access the networks and servers of the law firms they targeted.

Tagscyber fraud, US Securities and Exchange Commission, extradition treaty, insider trading, cyber hacking, Department of Justice, Chinese nationals, computer intrusion