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Arrest Over Software Illuminates Wall St. Secret
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Arrest Over Software Illuminates Wall St. Secret
Arrest Over Software Illuminates Wall St. Secret
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http://www.nytimes.com/2009/08/24/business/24trading.html
By Alex Berenson
The New York Times
August 23, 2009
Flying home to New Jersey from Chicago after the first two days at his
new job, Sergey Aleynikov was prepared for the usual inconveniences: a
bumpy ride, a late arrival.
He was not expecting Special Agent Michael G. McSwain of the F.B.I.
At 9:20 p.m. on July 3, Mr. McSwain arrested Mr. Aleynikov, 39, at
Newark Liberty Airport, accusing him of stealing software code from
Goldman Sachs, his old employer. At a bail hearing three days later, a
federal prosecutor asked that Mr. Aleynikov be held without bond because
the code could be used to =E2=80=9Cunfairly manipulate=E2=80=9D stock prices.
This case is still in its earliest stages, and some lawyers question
whether Mr. Aleynikov should be prosecuted criminally, or whether a
civil suit may be more appropriate. But the charges, along with civil
cases in Chicago and New York involving other Wall Street firms, offer a
glimpse into the turbulent world of ultrafast computerized stock
trading.
Little understood outside the securities industry, the business has
suddenly become one of the most competitive and controversial on Wall
Street. At its heart are computer programs that take years to develop
and are treated as closely guarded secrets.
[...]
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