Bloomberg is reporting that former Societe Generale SA trader Samarth Agrawal was sentenced to three years in prison for stealing the bank’s high-speed trading software.
A federal jury in Manhattan in November found Agrawal, 27, guilty of theft of trade secrets and of transporting stolen property in interstate commerce after a two-week trial. U.S. District Judge Jed S. Rakoff sentenced him yesterday.
“In the case of this defendant, we have an essentially good guy who did something very bad,” Rakoff said in ordering a prison term of less than the 63-month to 78-month sentence called for under federal guidelines.
Rakoff said he gave Agrawal credit for accepting responsibility for his crime and for having led an honest life before the theft. In addition to the prison term, Rakoff sentenced Agrawal to two years of supervised release. Agrawal may be deported to his native India after his release from prison, Rakoff said.
At trial, Agrawal testified under questioning by his own lawyer that he shared information about Societe Generale’s trading software with a Manhattan hedge fund, Tower Research Capital, LLC, where he hoped to create a similar system. Rakoff said at the time that he was “puzzled” by Agrawal’s testimony and that he assumed it was part of a “sympathy defense.”
“He was essentially admitting all of the elements of the charge as the court interpreted the indictment,” Rakoff said yesterday.
Agrawal also testified that his superiors at Societe Generale encouraged him to work at home because spending too many nights and weekends in the office would raise “red flags” for company security. He said that was why he printed copies of the computer codes in June 2009 to study at home.
Agrawal was hired in 2007 in New York by the Paris-based bank to be a quantitative analyst. He was promoted to trader and given access to the company’s high-frequency trading software in April 2009, according to prosecutors.
Later, during 10 to 12 meetings with Tower executives, he shared some aspects of a Societe Generale trading program called DQS, for “distributed quotation system,” Agrawal said. He said he used Societe Generale’s codes because he wanted the job at Tower and because he would have had to build a similar system once hired by the hedge fund.
“That is SocGen’s trade secret and I stole it,” Agrawal said in a statement to Rakoff before he was sentenced. “And I should not have.”