Judge says former Uber security chief must face fraud charges over alleged role in hacking coverup
Joseph Sullivan is also facing two charges of obstruction
A federal judge ruled Tuesday that a former Uber security chief must face wire fraud charges over his purported involvement in attempting to cover up a hacking in 2016, exposing personal information of 57 million of the company's drivers and passengers.
Joseph Sullivan had the three wire fraud charges added by the Department of Justice in December to a previous indictment. The DOJ alleges he made arrangements to pay hush money to two hackers, while also trying to hide the hacking from drivers, passengers and the U.S. Federal Trade Commission.
U.S. District Judge William Orrick rejected Sullivan's claim that prosecutors failed to adequately argue he concealed the hacking in an effort to ensure that Uber drivers would not flee and would continue making service fee payments.
The judge also rejected Sullivan's assertion that those who were allegedly hacked were Uber's then-CEO Travis Kalanick and the company's general counsel, but no drivers.
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A federal judge ruled Tuesday that a former Uber security chief must face wire fraud charges over his purported involvement in attempting to cover up a hacking in 2016, exposing personal information of 57 million of the company's drivers and passenge (REUTERS/Toby Melville/Illustration/File Photo / Reuters Photos)
"Those purported misrepresentations, though not made directly to Uber drivers, were part of a larger scheme to defraud them" according to the indictment, Orrick wrote.
Sullivan was initially indicted for his role in the scheme in September 2020. He is believed to be the first corporate information security officer criminally charged with covering up a hacking.
Prosecutors allege that Sullivan arranged to pay the hackers $100,000 in bitcoin, and have them sign nondisclosure agreements falsely claiming they had not stolen any data.
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Uber had a bounty program created to reward security researchers who report flaws. The program was not, however, designed to conceal data thefts.
The ride-sharing company's current CEO, Dara Khosrowshahi, terminated Sullivan's employment after learning about the extent of his breach.
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The company paid $148 million in September 2018 to settle claims by all 50 U.S. states and Washington, D.C., with each alleging Uber was too slow to disclose the hacking.
Sullivan is also facing two charges of obstruction.
Reuters contributed to this report.