Oilpro.Com Founder Charged In Manhattan Federal Court With Hacking Into Competitor’s Computer System

Preet Bharara, the United States Attorney for the Southern District of New York, and Diego Rodriguez, Assistant Director-in-Charge of the New York Field Office of the Federal Bureau of Investigation (“FBI”), announced today that DAVID W. KENT, the founder of professional networking website Oilpro.com (“Oilpro”), was arrested for charges relating to computer hacking and wire fraud.  The charges stem from KENT’s alleged role in repeatedly hacking into a competitor’s database to steal customer information and attempting to sell Oilpro to the same company whose database KENT had hacked.  KENT was arrested by FBI agents in Spring, Texas, this morning and will be presented before U.S. Magistrate Judge Dena Palermo in Houston this afternoon.

Manhattan U.S. Attorney Preet Bharara said:  “As alleged, David Kent hacked into a competitor’s database and stole information from over 700,000 customer accounts.  Later he allegedly tried to use the proprietary information to defraud that same company. Thanks to the efforts of our law enforcement partners at the FBI, David Kent will now be held to account for his criminal conduct.”           

FBI Assistant Director-in-Charge Diego Rodriquez said:   “In this case, a profitable business was sold for approximately $51 million.  Allegedly, however, instead of relinquishing control of his former company, subject David Kent continued to illegally access data and information from his former business to help benefit a competing business he formed after the sale.  Unauthorized access to a protected computer system is a federal crime.  The FBI will investigate and bring to justice criminal actors who commit computer intrusions, whether the unauthorized access is to a personal computer or a corporate server.”

According to the allegations in the Complaint unsealed today in Manhattan federal

court[1]:

In or about March 2000, KENT founded a website (“Website-1”) that provides, among other things, networking services to professionals working in the oil and gas industry.  Website-1 allows its members to create profiles, which include personal and professional information.  As part of their profiles, members can also upload their resumes.  The profiles are contained in a database maintained by Website-1 (the “Members Database”).  Members are assigned login credentials (i.e. usernames and passwords) when they create their profiles.  Members use these login credentials to access their profiles.

In or around August 2010, KENT sold Website-1 for approximately $51 million to a publicly-traded company headquartered in New York, NY (“Company-1”).  KENT entered into an employment agreement with Company-1 and agreed to continue to serve as the President of Website-1 after the acquisition.  However, KENT left Website-1 in September 2011 and launched Oilpro in October 2013.  Like Website-1, Oilpro provides networking services to professionals working in the oil and gas industry.  Oilpro is headquartered in Houston, Texas.

Between October 2013 and February 2016, KENT conspired to access information belonging to Website-1 without authorization and to defraud Company-1.  KENT accessed the Website-1 Members Database without authorization and stole customer information, including information from over 700,000 customer accounts.  KENT then exploited this information by inviting Website-1’s members to join Oilpro.  Similarly, one of Kent’s employees at Oilpro who previously worked for Website-1 (“CC-1”) accessed information in Website-1’s Google Analytics account without authorization and forwarded the information to KENT.  In the meantime, KENT attempted to defraud Company-1 by misrepresenting during discussions about a potential acquisition of Oilpro by Company-1 that Oilpro had increased its membership through standard marketing methods.           

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KENT, 40, of Spring, Texas, has been charged with one count of conspiracy to commit computer hacking and wire fraud, which carries a maximum term of five years in prison, and one count of wire fraud, which carries a maximum term of 20 years in prison.  The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Bharara praised the investigative work of the FBI.  Mr. Bharara also thanked the Office of International Affairs and the United Kingdom’s National Cyber Crime Unit (NCCU), and noted that the investigation is continuing.  

This case is being handled by the Office’s General Crimes Unit.  Assistant United States Attorneys Sidhardha Kamaraju and Andrew K. Chan are in charge of the prosecution.

The charges contained in the Complaint are merely accusations and the defendant is presumed innocent unless and until proven guilty.