Computer programmer arrested for Goldman Sachs theft
A former computer programmer at investment bank Goldman Sachs has been charged with stealing computer codes used in the bank's algorithmic trading systems.
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The programmer, Sergey Aleynikov, a 39-year-old originally from Russia, was arrested on Friday.
He is accused of uploading the 32MB of code to a server in Germany.
Goldman Sachs would not comment.
Automatic trading software is increasingly important to investment firms as the number of trading venues increases and the volume of electronic trading grows.
PJ Di Giammarino, CEO at financial services think-tank JWG-IT, said: "Because of the data war out there, it is more and more down to IT systems and what messages you send them to tell them what to do and how the messages instruct them to do it."
"These codes, which have allegedly been stolen are fundamental to how Goldman makes money in electronic trading," added Di Giammarino.
The heavy reliance on computer systems to control trades at investment banks makes security a massive challenge.
In January last year French bank Societe Generale lost £3.6bn following unauthorised activity of a rogue trader who covered up fraudulent activity as a result of his understanding of the bank's fraud control systems. Paris-based Jerome Kerviel used his knowledge of automatic checks, which are carried out on trades to check they are legitimate, to avoid being found out. He risked billions by betting on future trends in the stock market.