Two men involved in an international computer hacking ring pleaded guilty in Federal Court in Delaware today.
The men, 28-year-old Sanadodeh Nesheiwat of Washington, New Jersey and 22-year old David Pokora of Ontario Canada, each pleaded guilty to one count of conspiracy to commit computer fraud.
Nesheiwat and Pokora are part of a hacking group that called themselves the “Xbox Underground.”
The group allegedly hacked into accounts including the U.S. Army, Microsoft, Zombie Studios, and others. Once inside the accounts, they were able to access items such as trade secrets and financial information.
From 2011 to 2013 the group accessed data from a U.S. Army flight simulator for Apache helicopter pilots.
Prosecutors believe they were able to access the simulator through a video game company that was developing software for the Army.
The hackers were also able to obtain enough information to produce a counterfeit Xbox One gaming console ahead of its official release date last year.
The counterfeit Xbox was sold online for $5,000. The hacker group attempted to sell another counterfeit system for $20,000, according to prosecutors.
Microsoft had no comment on the case.
Damages are estimated between $100 and $200 million.
Assistant U.S. Attorney Edward McAndrew called the group “extremely sophisticated computer hackers.”
“Don’t be fooled by their ages,” he said.
Two other group members have been indicted in the United States, a fifth member is being prosecuted in Australia.
Prosecutors believe as many as a dozen members could be involved in the hacking ring.
The defendants were brought to Delaware because of the state’s ability to handle intellectual property cases.
McAndrew added that this is the first time the United States has been successful in prosecuting a foreign hacker.
A sentencing hearing is scheduled for January 13. They each face up to five years in prison.