A shocking case of corporate espionage has rocked the financial sector as Zhengquan Zhang, a 35-year-old computer engineer from New York, was arrested for stealing over three million files of proprietary trading code from his employer, a global financial services firm headquartered in New York, New York.
The alleged theft, which took place from December 2016 through March 2017, saw Zhang install code designed to steal his employer’s proprietary information and illegally access colleagues’ computer systems to further his theft.
According to the allegations contained in the Complaint unsealed today, Firm-1 uses proprietary algorithmic trading models to help it predict market movements and make trading decisions. In addition, Firm-1 uses proprietary trading platforms to create orders, automatically submit those orders to an exchange or market center, and execute orders.
‘As alleged, Zhengquan Zhang went to great lengths to surreptitiously steal confidential computer code from his employer,’ said Acting U.S. Attorney Joon H. Kim. ‘Zhang allegedly installed code designed to steal his employer’s proprietary information and illegally accessed colleagues’ computer systems to further his theft.’
The FBI is committed to enforcing laws that protect U.S. companies from the theft of trade secrets, said FBI Assistant Director-in-Charge William F. Sweeney Jr.
Zhang was arrested this morning in Santa Clara, California, and was presented this afternoon in federal court in San Jose, California.
Zhang, a/k/a ‘Zheng Quan Zhang,’ a/k/a ‘Jim Z. Zhang,’ is charged with theft of trade secrets for his alleged theft of proprietary computer code concerning algorithmic trading models and trading platforms from his employer.
The alleged theft can happen to even the most sophisticated companies, but this arrest was made possible by the exemplary cooperation between the FBI and the victim company, which came forward promptly and alerted law enforcement of this alleged crime.
The theft of proprietary trading code is a serious offense, and we will continue to work tirelessly to protect U.S. companies from such crimes.
ZHANG’s lawyer was not available for comment.
ZHANG is currently being held without bail.
The case is assigned to U.S. District Judge
This article will be updated as more information becomes available.
Key Facts
- State: New York
- Category: Cybercrime
- Source: DOJ Press Release â†â€â€
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