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Former CME software engineer pleads guilty to code theft

20 September 2012  |  5305 views  |  0 Man writing graphs on glass wall

A former senior software engineer at CME Group has admitted to stealing source code from the Chicago-based exchange operator at the same time as he was working to boost the technological performance of a Chinese bourse.

Chunlai Yang, who is a naturalised US citizen and had worked at the exchange for 11 years, was arrested at his desk at the CME's Chicago HQ last year.

He has now pleaded guilty to two counts of theft of trade secrets and faces a maximum penalty of 10 years in prison and a $250,000 fine on each count. He has been released on a $500,000 secured bond and is set to be sentenced in February.

Between late 2010, and June 2011, Yang downloaded more than 10,000 computer files containing CME source code making up a substantial part of the operating systems for the Globex electronic trading platform.

Once he had downloaded the files from the firm's secure internal computer system to his work computer he transferred many to USB flash drives and then to his personal computers and hard drives.

Yang also admits to downloading thousands of others CME files while court documents show that he printed internal manuals and guidelines describing how many of the files that comprise Globex operate and how they interact with each other.

Meanwhile, the programmer has admitted that, along with a couple of business partners, he had developed plans to set up a business called Tongmei (Gateway to America) Futures Exchange Software Technology Company (Gateway).

This was intended to increase the trading volume at the Zhangjiagang Exchange, a Chinese chemical electronic trading bourse, by boosting its platform. Yang says that he expected that his Gateway business would provide the exchange with technology through written source code to allow for high trading volume, fast trading speeds, and multiple dealing functions.

He also promised to expand the Zhangjiagang Exchange's software by providing customers with more ways of placing orders; connecting the exchange database's storage systems and matching systems; rewriting the trading system software in Java; raising the system's capacity and speed by modifying communication lines and structures; and developing trading software based on FIX.

KeywordsLEGAL

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