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The Citadel Trail Emerges, Goldman Injunction Likely To Follow Shortly

Tyler Durden's picture

Just when one thought it is possible to have a big scandal erupt, in which Chicago is named and not have Ken Griffin involved, the Citadel trail emerges. Contrary to previous rumors that Getco may have been the unfortunate firm to land Bond, Serge Bond, Misha Malyshev's new outfit, Teza Technologies, emerges with a bang. Teza, run by Misha, whom #810081;">Zero Hedge has discussed previously, former Head of High-Frequency Trading at Citadel, together with another former teammate and recent Princeton grad (resume recently pulled from the interwebs), #810081;">Jace Kohlmeier, announced that it had suspended Sergey without pay after learning of the allegations. From #810081;">Bloomberg:

Aleynikov, 39, started at Teza on July 2, the day before he was arrested, the firm said in an e-mailed statement today. Teza, co-founded by Misha Malyshev, a former trader at hedge fund Citadel Investment Group LLC, said it first learned of the allegations on July 5 and suspended Aleynikov without pay following an investigation.

The firm “was not aware of the alleged misconduct” and offered to cooperate with the government, according to the statement. James Margolin, a spokesman for the FBI’s New York Office, said the investigation is continuing.

One wonders if the arrest of Sergey one day after his formal start at Teza was strangely coincident. It is easy to imagine that 85 Broad would like as little hi-fi competition in any way, shape or form, and Misha, whose group at Citadel was the only profitable one last year, would have likely presented just such a "challenge." Arguably Goldman was just waiting for the Teza confirmation before throwing a 10,000 page injunction against Teza to prevent the current group from ever trading 1 share of high-frequency traded SPY in their combined lifetimes, based on possible information that Sergey may have "leaked" to Misha and Jace. And another one bites the dust.

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Tue, 07/07/2009 - 03:45 | Link to Comment Anonymous
Tue, 07/07/2009 - 03:53 | Link to Comment Anonymous
Tue, 07/07/2009 - 04:04 | Link to Comment Anonymous
Tue, 07/07/2009 - 07:38 | Link to Comment Anonymous
Tue, 07/07/2009 - 05:02 | Link to Comment Anonymous
Tue, 07/07/2009 - 07:12 | Link to Comment Anonymous
Tue, 07/07/2009 - 07:22 | Link to Comment Anonymous
Tue, 07/07/2009 - 08:22 | Link to Comment Anonymous
Tue, 07/07/2009 - 08:31 | Link to Comment Insiderman
Insiderman's picture

Let's see if the Feds can keep Sergey alive long enough to hear some of the more gruesome GS stuff!  Can't wait to find out if the program really front-runs.

Tue, 07/07/2009 - 10:05 | Link to Comment Veteran
Veteran's picture

Man, lot of hate coming your way over the last few days, Tyler.  Stay strong brother

Tue, 07/07/2009 - 10:42 | Link to Comment dnarby
dnarby's picture

Wasn't GS leasing tankers full of oil?

If so, then this doesn't look promising for them...

Tue, 07/07/2009 - 11:16 | Link to Comment Anonymous
Tue, 07/07/2009 - 12:15 | Link to Comment Anonymous
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