Japan sees $700 million in hacked trades as phishing scams explode

Japanese brokerages have reported at least 1,454 cases of hacked trading worth almost ¥100 billion ($700 million) since February, as phishing scams soar in the country, the nation’s financial regulator said.

The number of unauthorised trades reported by brokerages has climbed to 736 in the first 16 days of April, compared with 685 for all of March and 33 in February.

So far this month six online brokerages have been affected, the Financial Services Agency said in a press release.
An FSA official said in a news conference Friday that brokerages will be allowed to compensate for customers’ losses.

In many cases, hackers sold stocks of accounts they infiltrated, using the proceeds to buy Chinese shares, the FSA said in the press release. Unauthorised selling orders amounted to ¥50.6 billion since February while buy orders reached ¥44.8 billion.

Nomura Holdings Inc., SMBC Nikko Securities Inc. and SBI Holdings Inc. are among firms that have seen instances of fraudulent transactions after they were first discovered at Rakuten Securities Inc. in late March.

Following the surge in hacked trading, industry group Japan Securities Dealers Association urged brokerages to tighten authentication requirements for client accounts.