US Charges Four Pakistani Nationals Over Alleged $41 Million Crypto and Stock Fraud Scheme

US federal authorities have charged four Pakistani nationals in connection with an alleged securities fraud scheme that prosecutors say generated approximately $41 million in illicit profits.

The defendants include three brothers and a childhood friend, who are accused of operating a complex operation involving insider trading, hacking, and market manipulation across crypto and equity markets between 2020 and 2024.

According to the indictment, the case centres on the Shoukat brothers, all of whom hold dual US and Pakistani citizenship. Muhammad Saad Shoukat, 33, is alleged to have acted as the ringleader and primary point of contact for obtaining material non-public information. Muhammad Arham Shoukat, 35, is accused of handling technical activities such as hacking and website spoofing while operating from locations including Islamabad and Malaysia. Muhammad Shahwaiz Shoukat, 36, is alleged to have managed financing and trading activity, including the use of accounts held in his ex-wife's name while based in Amsterdam.

The fourth defendant, Daniyal "Dan" Khan, 33, a dual UK and Pakistani citizen and longtime associate of the brothers, is also charged in connection with the scheme.

Prosecutors allege that one component of the operation involved insider trading based on confidential information obtained from an individual at a San Francisco investment bank. Saad Shoukat is accused of passing this information to the others, who then traded ahead of acquisition announcements involving companies such as GBT Therapeutics and Oak Street Health.

When insider information was unavailable, authorities allege the group resorted to market manipulation. In one instance, Saad and Arham Shoukat are accused of hacking a patient account on a breast cancer forum and posting falsified clinical data related to Olema Pharmaceuticals, causing the company's stock price to rise before they sold their positions.

In another alleged scheme, Arham Shoukat is accused of arranging the creation of a spoofed website resembling that of Opiant Pharmaceuticals. Prosecutors say the site was used to mislead a public relations firm into publishing a false press release announcing a $225 million acquisition, triggering a 29% surge in the stock price before the group exited their trades.

The defendants face multiple charges, including securities fraud, wire fraud, and conspiracy. Based on the number of counts, prosecutors said the potential maximum prison sentences range from more than a century to nearly 245 years for some of the accused if convicted.

Authorities described the case as a major enforcement action targeting cross-border financial crime involving both crypto assets and public equities.