Ex-Goldman Programmer Detailed His Code Downloads to FBI Agent

July 10th, 2009

It looks like there’s a large bozo factor in this case. If there was criminal intent, this will be one for America’s Dumbest Criminals.

Via: Bloomberg:

Sergey Aleynikov, the former Goldman Sachs Group Inc. computer programmer arrested last week for stealing software, told an FBI agent he uploaded proprietary code to an encrypted server he had used on “multiple occasions.”

Aleynikov, 39, told the agent around 1 a.m. on July 4 that he had logged into Goldman’s computers through remote access from his home and sent encrypted files to a repository server with the URL identifier svn.xp-dev.com, according to a copy of his FBI statement in court files in Manhattan federal court.

Xp-dev.com is registered to London resident Roopinder Singh, who describes himself on a blog linked to the site as a trading systems developer working in London’s financial services industry. The site offers “subversion hosting,” letting users track current and previous versions of programming code and other documents.

Singh told his customers in the blog yesterday that he’d been contacted by “local UK authorities,” who had seized his hard drives to examine them and shut his service down for 45 hours, beginning on July 6, two days after Aleynikov’s arrest.

“It turns out that some idiotic moron a user had uploaded data on to the service that he/she was not authorized to have,” he said, crossing out the words “some idiotic moron.” “This is your basic intellectual property theft case here.”

Singh didn’t immediately respond to phone calls and e- mails. FBI spokesman Jim Margolin and Rebekah Carmichael, a spokeswoman for Acting U.S. Attorney Lev Dassin, declined to comment.

Assistant U.S. Attorney Joseph Facciponti said at Aleynikov’s arraignment July 4 that the alleged theft is the “most substantial” that the bank can recall.

‘Worth Millions’

“The proprietary code, worth millions of dollars, lets the firm do “sophisticated, high-speed and high-volume trades on various stock and commodities markets,” prosecutors said in court papers. Facciponti said a person misusing the code might be able to “manipulate markets.”

On his personal blog, Singh wrote that he provides his service free and that any code stored there is kept safe and encrypted before being backed up every night “off-site.”

Aleynikov, who holds dual U.S. and Russian citizenship, told the agent the files he sent to Singh’s server “have been not shared with any person or corporation” and that it “was not my intent be involved in any malicious action.”

Facciponti said at the arraignment that Aleynikov transferred the code to a computer server in Germany and that others may have had access to it, a claim that Aleynikov denied in his statement to the Federal Bureau of Investigation agent, Michael McSwain. The prosecutor said the U.S. was investigating whether other code was sent to the server.

Internet records indicate Singh’s Web site is located in Bavaria.

Other Instances

Aleynikov told McSwain he used the server on other instances.

“I have uploaded files to svn.xp-dev.com on multiple occasions over the last couple months,” Aleynikov said in the FBI statement. The phrase, “over the last couple months” is crossed out.

It was unclear if he used the server to store Goldman software or other code.

“The files that are proprietary information of Goldman Sachs has not been shared with any individual or corporation,” Aleynikov repeated near the conclusion of the three-page statement.

In the statement, Aleynikov laid out what had happened from the downloading of the files to their transfer to the server and his retrieval of them from it. He said that on June 5 he “created a tarball in an effort to collect open source work on Goldman Sachs server to which I had an account.”

Tarball

A tar file, which is sometimes called a tarball, is a compressed file.

“I had previously worked on the files,” he said.

He said he encrypted the files, then erased the encryption software and the tarball.

“I then erased the bash history,” he said, referring to a method of recalling commands used in previous computer sessions.

Goldman security measures prevent such deletions, which tipped the firm off to his activities, prosecutors said.

Aleynikov said in his statement that he downloaded the Goldman software to his home computer, his laptop computer and his thumb drive.

“The reason I uploaded to svn.xp-dev.com was because it was not blocked by Goldman Sachs security policy,” Aleynikov wrote. The phrase, “not blocked by Goldman Sachs security policy,” was crossed out and he added: “I wanted to inspect the work later in a more usable environment.”

More Than Intended

Aleynikov said that he later opened the files to inspect them.

“At that point I realized that I downloaded more files than I intended,” he said.

Aleynikov, who lives in New Jersey, was arrested on July 3 after arriving at Liberty International Airport in Newark. He was charged with stealing the trading software and is free on a $750,000 bond.

Teza Technologies LLC, a Chicago-based firm co-founded by a former Citadel Investment Group LLC trader, said after his arrest that it had suspended Aleynikov, who started there on July 2. Aleynikov had told co-workers at Goldman that he was joining a new firm at triple his salary of $400,000 a year.

Michael DuVally, a spokesman for New York-based Goldman, declined to comment.

Aleynikov said Teza wasn’t involved. “I have signed an agreement with my new employer not to bring any unlicensed software,” he said. “I have not violated that agreement.”

Studied Math

Aleynikov studied applied mathematics at the Moscow Institute of Transportation Engineering before transferring to Rutgers University, where he received a bachelor’s degree in computer science in 1993 and a master’s of science degree, specializing in medical image processing and neural networks, in 1996, according to his profile on the social-networking site LinkedIn.

Before joining Goldman Sachs, he worked for about eight years at IDT Corp., the U.S. vendor of prepaid calling cards, where he led the team responsible for developing routing systems, according to the profile.

His profile on LinkedIn describes him as a vice president in equity strategy at Goldman Sachs and includes two recommendations from colleagues at the firm.

The case is U.S. v. Aleynikov, U.S. District Court, Southern District of New York (Manhattan).

One Response to “Ex-Goldman Programmer Detailed His Code Downloads to FBI Agent”

  1. luky says:

    I especially like that sentence “a person misusing the code might be able to manipulate markets”. Good then that Goldman Sachs would never ever misuse anything like that.

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