A former trader at Societe Generale was given a 3-year jail sentence for stealing trade secrets from the financial firm.
A federal judge in Manhattan district court gave Samarth Agrawal, 27, jail time for his role in stealing proprietary code used in the bank's multimillion dollar high frequency trading system. The 3-year sentence is far less than the 10-year maximum allowable under the law. Agrawal was also given two years of supervised release following his release from prison.
Agrawal, 27, worked in Societe Generale's New York office. Two months after he was promoted to the position of trader in 2009, Agrawal allegedly copied code from the proprietary trading system into Microsoft Word documents. The FBI said security cameras caught Agrawal printing segments of the computer code and putting the printouts in a backpack.
Prosecutors argued in court documents that the intended loss to Societe Generale as a result of Agrawal's actions was between $7 million and $20 million.
Security experts said the Societe Generale case was a lesson in poor authentication and user provisioning processes. Some experts said the financial firm failed to limit access to the source code of its system and properly provision the user roles limiting their access to certain systems and resources.
When he resigned from Societe Generale, Agrawal told a supervisor he eventually wanted to return to his native India and set up his own high frequency trading firm, prosecutors said. But he allegedly told an undercover FBI agent that he was interviewing with big name financial firms in New York.
Agrawal offered to build other firms a high frequency trading system like the one SG developed. Investigators discovered that he shared details of the stolen code with Tower Capital Research LLC in an agreement that would have netted him $575,000 plus 20% of the profits garnered through use of his SG high frequency trading clone.
Agrawal was arrested on April 19, 2010, the day he planned to start at Tower. Investigators found the stolen code during a search of his home.