Former Goldman Sachs programmer Sergey Aleynikov has been sentenced to eight years and one month in jail for stealing the bank's propriety high-frequency trading code.
Aleynikov was found guilty by a Manhattan jury in December of theft of trade secrets and interstate transportation of stolen property charges. Earlier this month he was returned to custody after being declared a flight risk.
US District Judge Denise Cote has now sentenced him to 97 months in jail followed by three years of supervised release and fined him $12,500.
The Russian-born programmer worked for Goldman from May 2007 to June 2009, where he developed computer programs supporting the firm's high-frequency trading on various commodities and equities markets.
The bank acquired the HFT system - which generates millions of dollars a year in profits - for around $500 million in 1999 from Hull Trading Company.
Aleynikov quit Goldman to help develop a HFT platform for Teza Technologies, a Chicago-based start-up formed by ex-Citadel executive Mikhail Malyshev.
Prosecutors alleged that on his last day working for the bank, Aleynikov transferred "substantial portions" of Goldman Sachs's proprietary computer code for its trading platform to an outside computer server in Germany.
He encrypted the files and transferred them over the Internet and then deleted "the program he used to encrypt the files and deleted his computer's "bash history," which records the most recent commands executed on his computer".
In addition, he had already transferred "thousands of computer code files" related to the firm's proprietary trading program to his home computers during his two years working there.
He did this by e-mailing the code files from his Goldman Sachs account to his personal one and storing versions of the code files on his home computers, laptop, a flash drive and other storage devices, say prosecutors.
On 2 July Aleynikov flew to Chicago to meet Teza, taking a laptop and storage device holding Goldman proprietary code. He was arrested the following day at Newark airport.
Manhattan US Attorney Preet Bharara, says: "Protecting the proprietary information of America's companies is critically important. Today's sentence sends a clear message that professionals like Sergey Aleynikov who abuse their positions of trust to steal confidential business information from their employers will be prosecuted and punished."
The sentence comes weeks after former SocGen trader Samarth Agrawal received a three years sentence for stealing high frequency trading code.