A former Societe Generale trader has been arrested by US authorities and charged with stealing propriety computer code used in the bank's high-frequency trading (HFT) system.
Samarth Agrawal, a trader at the French bank's HFT group in New York, is accused of copying reams of proprietary code into Microsoft Word documents last June. According to authorities he then printed off hundreds of pages of data and was captured by surveillance cameras putting "what appeared to be printouts" into a backpack.
On 12 November 2009 Agrawal deleted a folder on his personal network drive that contained the code, says the FBI. It was his last day in the office. He took the next four days off work sick before submitting his resignation.
After quitting the bank, Agrawal allegedly told an undercover FBI agent that he had since been interviewed by "most of the big names" among New York financial firms.
SocGen says it has spent millions of dollars developing a computer system and associated code that allow it to engage in sophisticated, high-speed trading on various securities markets.
The bank has moved to protect the code by limiting access to only those employees whose jobs require it, and then to only those units of the code related to their job. It also monitors computer systems and restricts electronic transfers outside of its systems.
However, as an HFT trader, Agrawal was able to beat the safeguards. He now faces one charge of theft of trade secrets and could be sentenced to 10 years in prison.
US Attorney Preet Bharara says: "While it took years for his employer to develop its sophisticated computer code, it allegedly only took Samarth Agrawal days to steal it. The theft of trade secrets is a serious crime and this Office will continue to work tirelessly with the FBI to identify and prosecute its perpetrators before they can profit from their misconduct."
The immense value of HFT code to trading firms has been highlighted by several recent theft cases. Earlier this year former Goldman Sachs computer programmer Sergey Aleynikov was indicted on charges related to the theft of propriety code connected to the investment bank's high-frequency trading platform.
In February UBS lost its bid to get a permanent injunction against three former quant traders accused of stealing proprietary algorithmic trading software with the intent of using it at their new employer, Jefferies.