Sergey Aleynikov, who had pleaded guilty to stealing proprietary trading code involving Goldman Sachs' high frequency trading algorithms, received a 97-month jail sentence from a federal court judge yesterday. The sentencing itself, which received very little mainstream media play, was noted in the financial blog Zero Hedge. The trial itself, in which the presiding judge showed a profound interest in protecting Goldman's secret sauce, was covered; The New York Times' overview of the case is a good starting point to understand the issues involved in the proceedings.The episode concludes a trial in which federal attorneys showed a prosecutorial zeal they have lacked when it comes to indicting major players in the 2008 financial disaster. One can reasonably suspect Wall Street, its political allies, lobbyist fixers, and legal condottiere have conspired to keep the likes of Countrywide's Angelo Mozilo from sharing a jail cell with Mr. Aleynikov. The 2010 Oscar winning documentary Inside Job, which my wife and I watched last night, serves as a primer about the financial scandals that nearly brought down the American house. The movie points out that the most significant perps of the disaster are not only free, but have enormously enriched themselves as a consequence of the policies that led to the financial collapse.
That is a disaster for which all of us now pay, thanks to the various bailouts, job losses, raised tax levels (unless you're in the Bush tax cut 1% club), and home valuation declines inflicted on those not in on the fix. Aleynikov's actions, in which he attempted to get an edge on Goldman's high-frequency trading inside game, is a symptom of a much more widespread disease. Don't expect the feds -- Democrat or Republican -- to administer an antidote to this corruption.
The photograph shows Mr. Aleynikov outside federal court in New York.
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