Source claims Manhattan DA probing on KCG Holdings code theft

A person familiar with the matter told Bloomberg that New York state prosecutors are currently investigation an incident wherein a computer code theft was stolen from KCG Holdings Inc. KCG Holdings specializes in high-frequency trading. The person, who refused to be named as the matter is private, said Manhattan District Attorney Cyrus R. Vance Jr is already looking into allegations made by attorneys for the New Jersey-based firm.

The news agency said that the heart of any firm dealing with high-frequency trading is is computer code, which automatically buys and sells shares, futures and other financial products.

Bloomberg noted that Vances office has brought cases similar to KCG's in recent years. In February, several employees of an $18 billion quantitative hedge fund, Two Sigma Investments LLC, has been charged of computer code theft. According to Two Sigma, one of the men had quit after the firm learned he had misappropriated sensitive information as part of his plan to offer it to a new employer. last year, Vance also filed charges against three Flow Traders employers based on allegations that they stole the firm's electronic software and had emailed it to themselves. In 2012, former Goldman Sachs Group Inc programmer Sergey Aleynikov was also charged by Vance's office with stealing proprietary software code from his employer.

When Bloomberg asked Vance's office regarding the alleged probe on stolen property at KCG, which was earlier reported by the Wall Street Journal, his office refused to comment on the matter.

KCG spokeswoman Sophie Sohn sent a statement about the supposed probe in a email without directly addressing the matter. She said, declining to comment further, "KCG is committed to safeguarding the integrity of the firm's intellectual property and cooperates fully with criminal and regulatory authorities."

KCG was previously known by a different name, Getco LLC, and had transformed into a one of the most formidable high-frequency trading firms in the industry who use cutting-edge technology. KCG was founded by ex-ormer Chicago Mercantile Exchange and Chicago Board Options Exchange traders named Stephen Schuler and Dan Tierney. Just last year, KCG had purchased broker-dealer Knight Capital Group Inc.

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KCG Holdings Inc, KCG Holdings Inc computer code theft probe, Manhattan District Attorney Cyrus R. Vance Jr

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