San Diego Housing Bubble News and Analysis

lol....A computer geek that goldman paid $400k/year steals a trading software that cannot run outside the company and subsequently ends up in jail..

Idiot.

You don't think that 32MB of data was worth way more?

"At a court appearance July 4 in Manhattan, Assistant U.S. Attorney Joseph Facciponti told a federal judge that Aleynikov’s alleged theft poses a risk to U.S. markets.

Aleynikov transferred the code, which is worth millions of dollars, to a computer server in Germany, and others may have had access to it, Facciponti said, adding that New York-based Goldman Sachs may be harmed if the software is disseminated. (Big Crocodile Tear -BCT)

“The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways ” Facciponti said..."

~~insert laugh track~~~

Goldman is essentially claiming their stolen program could harm markets if it was used.

Interesting claim by Goldmanfinger for their financial WMD. The could MANIPULATE markets in an unfair way.

I wonder what the judge thinks.

When Goldman does it, they're smarter than everyone else.

When someone else does it, the code is lethal to the markets.

I don't buy it.

Not if you're a dumbass and try to steal it the way he did. You're bound to get caught. Also, not if you have a family with 3 kids.

Come on, of course there's going to be a shell log and network log if he actually tried to upload it to a remote server.

Next, I'd say one would need to duplicate not just the trading program but also the raw hardware. Even with this software, did he think he can run this on his desktop and execute faster than GS' arsonal of server banks?

The dude is royally fvcked though. He's probably looking at least a decade in jail. What would be funny is if you find this trading code on some filesharing website like Kazaa.

If he got just the executable, it's probably not going to be as useful outside the company..Unless it was writen on an interpreted language, which could easily be decompiled..At which point, you have to wonder WTF was GS doing to put this on something like Perl? If he actually got the source code, then you have to wonder WTF did this person have access to it in it's entirety?
Either way, GS' I.T. department gets an F-.

“Working through our assistant legal attache in Frankfurt and with the authorities in Germany, the FBI has taken steps to ensure that the appropriated code was not distributed,” FBI spokesman Jim Margolin said.

Sergey Aleynikov, 39, who left Goldman on June 5 for a Chicago firm and was arrested last Friday night, gave consent to the FBI to visit his home in Little Falls, New Jersey, over the weekend and remove all of his personal computers, according to court documents.

They show that Aleynikov, a father of three and a dual national of the United States and Russia, told the FBI he was cooperating because “I did not think I was doing anything wrong” when he downloaded copies to his personal computer, laptop and to a flash drive.

He told investigators that Goldman Sachs knew he worked on the program from home and said nothing about it previously, according to the court record.

Aleynikov said he had no intention of selling the information or breaking his employment agreement. Aleynikov was arrested at Newark Liberty airport in New Jersey on a flight from Chicago on July 3. On Monday, he was released on $750,000 bail, restricted to New York and New Jersey and ordered to surrender travel documents.

I agree to some extent. There has to be something else going on. This guy is some super programmer genius, working on a true WMD (no the G.W. Bush kind), and there's no protocol in place to keep the guy from just walking away with important data? And, why would this guy risk everything to leak to this?

I bet this guy really, just strolled out of the office, not even thinking about any crazy plots. I'm curious what server in Germany this was uploaded to. Is MobileMe hosted in Germany...lol.

But, beyond all that. The governments response was amazing fast. I've had the stereo stolen out of my car. It took forever for the cops to show up.

Why is code dangerous when someone besides Goldman has it?

The story is not the patsy who stole it.

The story is the code and who received it.

All I can think is Enron times 1000

Gary Gensler, Chairman
U.S. Commodity Futures Trading Commission
3 Lafayette Centre
1155 21st St., N.W.
Washington, D.C. 20581

Mary L. Schapiro, Chairman
U.S. Securities and Exchange Commission
100 F St. N.E.
Washington, D.C. 20549

Dear Chairman Gensler / Dear Chairman Schapiro:

I'm enclosing a copy of a report distributed July 6 by Bloomberg News Service about the U.S. government's prosecution of a former employee of Goldman Sachs Group Inc. involving the purported theft of a Goldman Sachs computer trading program. The report quotes Assistant U.S. Attorney Joseph Faccipointi as saying in U.S. District Court in New York City: "The bank has raised the possibility that there is a danger that somebody who knew how to use this program could use it to manipulate markets in unfair ways."

If the report quotes the assistant U.S. attorney correctly, and if he was characterizing Goldman Sachs' position correctly, then Goldman Sachs claims to have possession of a computer trading program that can manipulate markets. The assistant U.S. attorney's comment can be construed to suggest Goldman Sachs considers its own manipulation of markets to be fair, while such manipulation by others would be unfair.

The court proceeding described in the Bloomberg News story would seem to impugn all markets in which Goldman Sachs trades. On behalf of the Gold Anti-Trust Action Committee Inc., I ask your commission to investigate Goldman Sachs' trading program urgently and report its findings publicly.

Thanks for your consideration.

With good wishes.

CHRIS POWELL
Secretary/Treasurer

I think these kind of things have only limited success, the real power is being able to move the markets via the media (take the GS Oil to 200 call).

Or the Bail out of AIG which was just a give free money to GS scheme.

Someone should really do some DD on the GS and U.S. treasury ties.

I bet the guy started reading the zero hedge blog and got upset at GS's stranglehold on the markets and the government.

Jeeman

If you want to read more of the conspiracy theories on this... Barry Ritholtz has a compendium of links. If the bit about GS having the access to trades prior to their commitment... Wow!

http://www.ritholtz.com/blog/2009/07/is-...