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Intellectual Property Law

: Womble Trade Secrets Blog

High Frequency Trader Accused of Stealing Societe Generale's Trade Secrets

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Courthouse News Service is reporting that a former trader with Societe Generale was arrested and charged with stealing the code from the bank's high-frequency trading program.

Samarth Agrawal worked with the high-frequency trade group, which uses a multimillion-dollar computer system to perform sophisticated securities trading within milliseconds.

"The company has taken several steps to protect the confidentiality of the code, including limiting access to only those employees whose jobs require it, and then to only those units of the code related to their job," according to the complaint. SG also monitors users, restricts electronic transfers and blocks computers from making portable electronic copies of the code.

Within months of his promotion to the group, Agrawal, a native of India, copied and printed out hundreds of pages of code, according to the complaint. Prosecutors say Agrawal's activities were captured by surveillance cameras, and his computer files were constantly monitored.

In November 2009, 1 month after printing out the code, Agrawal resigned. His contract prevented him from working for another employer until March, but in April he told an undercover FBI agent who was posing as a recruiter "that he had been interviewing with 'most of the big names' among New York financial firms," according to the complaint.

Prosecutors say that between March 16 and April 7, Agrawal made or received about 115 calls from six large financial institutions.

"[SG] further believes that, if competing firms were to obtain the code and use its features, the financial institution's ability to profit from trades using the code would be significantly diminished," according to the complaint.

Agrawal, 26, is charged with theft of trade secrets, which is punishable by up to 10 years in prison.

Full post as published by Womble Trade Secrets Blog on April 21, 2010 (boomark / email).