Hamilton man arrested over massive Yahoo hack
Karim Baratov, 22, accused of working for Russian spies
A 22-year-old Kazakh-Canadian man with expensive tastes is facing charges of identity theft and conspiracy to commit computer fraud in connection with one of the biggest data breaches ever — the theft of 500 million Yahoo user accounts in early 2014.
Karim Baratov, a dual national of Kazakhstan and Canada, was arrested on Tuesday morning at his home in Ancaster (Hamilton) by Toronto Police and handed over to the RCMP, according to police spokesperson Mark Pugash.
Baratov is accused of being paid by two Russian spies to break into the email accounts of targeted individuals, according to a release from the U.S. Department of Justice.
The two members of the Russian intelligence agency FSB, Dmitry Dokuchaev, 33, and Igor Sushchin, 43, and Russian hacker Aleksey Belan, 29 — who was on the FBI’s most wanted cyber criminals list and has been previously indicted twice for computer fraud — are facing more serious charges of criminal espionage, computer hacking and conspiracy-related offences after being indicted along with Baratov by a grand jury in northern California at the end of February. The stolen information from the Yahoo hack was used to break into the email accounts of Russian journalists, U.S. and Russian government officials and employees in private-sector companies, according to the Justice Department release. Belan allegedly used the access to the 500 million email accounts for “personal financial gain.”
Baratov’s alleged involvement in the hacking conspiracy between January 2014 and December 2016 is detailed in an indictment filed with a San Francisco court. None of the charges have been proven in court.
Carmelo Truscello, who answered the phone at the office of Baratov’s lawyer Amadeo DiCarlo, said that the case is only at its initial stage and that the allegations are unproven.
When a target of interest had an email account other than a Yahoo one, Dokuchaev and Sushchin would assign Baratov to gain access to it, according to the indictment.
Among the targeted individuals were the former minister of development of a country bordering Russia and his wife, the assistant to the deputy chair of the Russian Federation; employees of a major Russian cybersecurity firm; Russian officials including one who worked in the bureau that investigates cybercrime, the CEO of a metals mining company in a country bordering Russia, prominent bankers in countries bordering Russia and an International Monetary Fund official.
Some of the email addresses could be accessed because of the Yahoo email hack, through the recovery email account function. Baratov allegedly also used a technique known as “spear phishing” to try and gain access to target email addresses. It entails sending out emails from an apparently trustworthy sender to obtain information like login credentials or infect computers with malware.
“When Baratov was successful, as was often the case, his handling FSB officer Dokuchaev paid him a bounty,” the indictment states.
Baratov was allegedly paid to obtain unauthorized access to more than 80 email accounts,
including 50 Google accounts. He generally charged about US$100 per account and was paid at least $1,000 in “money and other things of value” between April 2015 and 2016, according to the indictment.
If he is convicted, prosecutors will seek a forfeiture order for Baratov’s PayPal account and the fancy cars he was well-known for in Ancaster — a grey Aston Martin DBS and a black Mercedes Benz C54.
Department of Justice officials requested Baratov’s arrest through Canadian law enforcement authorities on March 7. An extradition file was opened in Toronto on March 10 with an arrest warrant that is sealed.
The file has been transferred to Hamilton Superior Court, where Baratov appeared briefly on Wednesday. He is next set to appear in court on Friday. An extradition hearing has not been scheduled.
RCMP spokesperson Sgt. Harold Pfleiderer said they assisted the FBI in its investigation. He would not answer more questions about whether Baratov is being investigated further by the RCMP and whether Canadian charges are possible.
Baratov may be the only one of the men to face a trial in the U.S. There is no formal extradition treaty between the U.S. and Russia, making it unlikely that the three other men, all Russian nationals and residents, will be handed over.
Dokuchaev is reportedly facing charges of state treason in Moscow for leaking information to the CIA.