Goldman Code Thief Gets 8 Years

NEW YORK—A former Goldman Sachs Group Inc. computer programmer was sentenced to eight years and one month in prison Friday for stealing the confidential source code of the investment bank's high-speed trading system.
Federal prosecutors in Manhattan had alleged that Sergey Aleynikov, 41 years old, secretly copied Goldman Sachs's confidential source code in his last days at the investment bank and intended to use it to build a similar trading platform at his new employer.
"I very much regret the foolish decision to download information, part of this information was proprietary to Goldman," Mr. Aleynikov said before sentencing. "I never meant to cause Goldman any harm. I did not intend to harm anyone."
However, U.S. District Judge Denise Cote in Manhattan didn't agree. "He knew that what he was doing would harm Goldman Sachs. There is no other impact," she said.
High-speed-trading firms and other financial firms aggressively protect their code, considering it a trade secret and a competitive advantage. Goldman required employees to sign a confidentiality agreement as part of their employment and that any software created by them in their jobs were the property of the investment bank.
Mr. Aleynikov was convicted of theft of trade secrets and transportation of stolen property in December.
Kevin Marino, Mr. Aleynikov's lawyer, had previously argued that Mr. Aleynikov only intended to use portions of the downloaded code that were "open source," or freely available.
"He made a tragic mistake," Mr. Marino said Friday.
Mr. Marino said Mr. Aleynikov plans to appeal his conviction
Mr. Aleynikov is the second person to be convicted in recent months of stealing proprietary computer code related to an investment bank's high-frequency trading business.
Samarth Agrawal, a former Société Générale SA trader, was sentenced to three years in prison in February for the theft of the French investment bank's computer code. He was convicted in November of theft of trade secrets and transportation of stolen property.
Late last month, a federal judge ordered that Mr. Aleynikov be jailed pending sentencing after prosecutors claimed he was an increased risk of flight in part because of the lengthy sentence he faces and his connections to his family in the U.S. are strained. Mr. Aleynikov holds dual Russian and U.S. citizenship and is separated from his wife.