All is fair in love,war and stocktrade?- hedge funds are under cyber attacks

For about two years, US hedge funds have been under stealthy attacks from cyber-criminals intent on intercepting trading strategies in order to profit from front-running and other illicit maneuvers, cyber-security experts say.

That hidden cyber-crime trend was highlighted Thursday when an unnamed US-based hedge fund was reported to have been hacked and its stream of high-speed trade data intercepted by cyber-criminals. They, in turn, apparently used the data to make their own trades first, according to a British cyber-security company.

The criminals inserted malware onto the hedge fund trading system platform that in turn caused an almost imperceptible microsecond or two delay to each of the speedy trades – enough to allow the criminals to do their own trading ahead of the company, BAE Systems Applied Intelligence experts said.

For about two years, US hedge funds have been under stealthy attacks from cyber-criminals intent on intercepting trading strategies in order to profit from front-running and other illicit maneuvers, cyber-security experts say.

That hidden cyber-crime trend was highlighted Thursday when an unnamed US-based hedge fund was reported to have been hacked and its stream of high-speed trade data intercepted by cyber-criminals. They, in turn, apparently used the data to make their own trades first, according to a British cyber-security company.

The criminals inserted malware onto the hedge fund trading system platform that in turn caused an almost imperceptible microsecond or two delay to each of the speedy trades – enough to allow the criminals to do their own trading ahead of the company, BAE Systems Applied Intelligence experts said.

"It's pretty amazing," Paul Henninger, global product director at BAE Systems, told CNBC, which first reported the attack. "The level of business sophistication involved as opposed to technical sophistication involved was something we had not seen before."

The just-disclosed hedge fund attack started in late 2013 with hackers sending a "spear phishing" e-mail that, once opened, installed malware onto the hedge fund's servers, BAE Systems officials said. The spear phishing e-mails appeared related to developments in the capital markets industry.

But even if the BAE disclosure was unusual in its sophistication, it was actually just one of many cases, part of a wave of largely unseen cyber-attacks targeting hedge funds over the past two years, say cyber-security experts.

http://www.cnbc.com/id/101778725