A Goldman Sachs programmer who was convicted of stealing internal data has had his conviction overturned by an appeals court.
A Manhattan jury found Sergey Aleynikov guilty in December 2010 of stealing trade secrets. He was sentenced to 97 months in jail and was fined $12,500.
But yesterday, U.S. Court of Appeals for the Second Circuit ordered a judgement of acquittal. The reason will be disclosed "in due course", according to reports.
As ZDNet's Larry Dignan noted in July 2009, the one risk that Goldman Sachs did not count on was worker espionage. But Goldman now presumably has to find a new suspect now that the appeal went in Aleynikov's favour.
The Russian-born programmer worked for Goldman between May 2007 and June 2009, and developed during his employment programs to support high-frequency trading (HFT) on equity markets. He then quit the firm to develop a HFT platform for a Chicago-based startup.
HFT uses complex algorithms to engage in rapid trading to exploit the tiny price discrepancies in the markets. It can generate millions on a daily basis.
The conviction will also be a blow to the U.S. Department of Justice, which has made crimes of this nature a high priority.
Prosecutors claimed that "substantial portions" of Goldman's propriety computer code for its trading platform was transferred to a server in Germany. He reportedly copied tiny code fragments and emailed them to his personal email account on a daily basis.
Last month, federal authorities arrested Chinese computer programmer Bo Zhang in New York, on charges that he stole over $10 million worth of software from the Federal Reserve Bank in New York.
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