Articles on Bloomberg are entertaining, juicy, and just a tad biased. That’s what makes Bloomberg a much better read than most news outlets (since the news is additionally entertaining and juicy).
In a recent article with the understated and rather misleading title “Goldman Sach’s Investment in Trading Code Put at Risk by Theft”, a computer geek employed at the company is accused of running off with a vital piece of company software, it is quoted:
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.
The man was travelling. Anyone who knows about travel in the United States understands that one must not, under any circumstances, carry any information on a hard drive that could be worth something to anyone. So it is standard practice to transfer one’s information (including any projects one might be working on) in a secure manner to the Internet, like a VPN, and securely wiping the hard drive prior to leaving for the airport.
But the comment that makes one laugh comes from the prosecution:
The prosecutor added, “Once it is out there, anybody will be able to use this, and their market share will be adversely affected.”
The proprietary code lets the firm do “sophisticated, high-speed and high-volume trades on various stock and commodities markets,” prosecutors said in court papers. The trades generate “many millions of dollars” each year.
In other words, the software allows Goldman Sachs to, basically, cheat. And if the software was released, it would let everybody, well, cheat. And that would not be fair, because it goes against the whole principle of, err, cheating. That is, if everybody cheats the same way, then it ceases to be cheating.
The defense attorney is also quoted:
“If Goldman Sachs cannot possibly protect this kind of proprietary information that the government wants you to think is worth the entire United States market, one has to question how they plan to accommodate every other breach,” she said.
The defense is right of course, but it’s not that the government has any more dignity to lose. Many know very well how Wall Street operates and how the government helps, but not everybody believes it yet.
Perhaps George H.W. Bush’s infamous 2006 quotation will some day come true:
“if the American people knew what we have done, they would string us up from the lamp posts.”
Perhaps the real worry for Goldman Sachs is that the leakage of such sensitive software would reveal just how the markets are rigged by the big players, and how the honest majority is swindled at every turn.