Saturday, 31 January 2015
Last updated 14 hours ago
Mar 21 2011 | 7:24am ET
The former Goldman Sachs programmer convicted of stealing the firm's high-frequency trading code on his way out the door was sentenced to more than eight years in prison on Friday.
Sergey Aleynikov downloaded "substantial portions" of that code on his last day at work at Goldman in the summer of 2009. He brought the fruits of that endeavor to a meeting with his new employers, Teza Technologies, the controversial HFT firm founded by several former Citadel Investment Group veterans, less than month later.
Teza denies it had any knowledge of Aleynikov's actions and has said it was not interested in Goldman's code.
That firm has been no stranger to the inside of a courtroom; Citadel sued it almost immediately, alleging that its founders had violated their non-compete agreements and that it was in imminent danger of "industrial espionage." The hedge fund giant labeled Teza a "veritable pirate ship of illegal activity."
Earlier this month, Teza co-founder Mikhail Malyshev, the former head of Citadel's HFT division, was indicted for perjury.
Aleynikov was convicted in December; earlier last week, U.S. District Judge Denise Cote refused his request to toss the guilty verdict or order a new trial. Instead, she imposed the 97-month sentence and a $12,500 fine.
Aleynikov "deserves a significant sentence because the scope of his theft was audacious—motivated solely by greed, and it was characterized by supreme disloyalty to his employer," Cote said at his sentencing.
Jan 23 2015 | 1:00pm ET
In our new section, FINtech Focus, we will profile one of these firms each week. While fintech is a broad category, we will be focusing on firms that specifically cater to the alternative investment industry. Read more…