Former Goldman Programmer Guilty of Stealing Software Secrets

Friday, 10 Dec 2010 03:44 PM

 

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A former Goldman Sachs programmer was convicted Friday of stealing secret computer code that enables high-speed trading from the company when he took a new job with a rival last year.

The jury in U.S. District Court in Manhattan convicted Sergey Aleynikov of North Caldwell, N.J., of theft of trade secrets and transportation of stolen property in interstate and foreign commerce.

Aleynikov of North Caldwell, N.J., could face up to 15 years in prison when he is sentenced March 18. Aleynikov and his lawyer, Kevin Marino, declined to comment after the verdict.

Prosecutors who had called it a case about theft and greed requested after the verdict that Aleynikov wear an electronic bracelet until sentencing. The judge did not immediately rule on the request.

The criminal case was brought after federal authorities concluded that Aleynikov left Goldman Sachs in 2008 with trade secrets to help his new company — Teza Technologies — gain an advantage with high-speed trading.

Marino had argued that the case should have been no more than a civil lawsuit rather than criminal charges.

Aleynikov, a naturalized U.S. citizen who came to the U.S. from Russia in 1990, left his $400,000 job as a vice president at Goldman Sachs Group Inc. to join Teza Technologies LLC, where he was to be paid $300,000 annually, with a $700,000 bonus in his first year and a revenue-sharing plan that would have added an additional $150,000 annually.

Marino said during the two-week trial that his client was merely trying to copy parts of the company's software that was taken from public software codes. He acknowledged that Aleynikov had violated the company's confidentiality agreements but said that was a civil matter.

Aleynikov was arrested on July 3, 2009, as he returned from a trip to his new employer's offices in Chicago.

The trial brought into focus sophisticated computer programs that use mathematical formulas to execute scores of trades in short periods of time after evaluating moment-to-moment developments in the markets.

The government said Goldman Sachs makes millions of dollars a year in profits from high-frequency trading and carries a competitive advantage over rivals because of the speed of its computer programs.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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