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 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), Jace Kohlmeier, announced that it had suspended Sergey without pay after learning of the allegations. From 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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Anonymous's picture


Anonymous's picture

I got my 0H cap. I wore it to the grocery store today. That is all.

Anonymous's picture

This isn't even news. You're twisting a non-event into some conspiracy theory....

Anonymous's picture

Drink up. It's only Kool-Aid

Anonymous's picture


Huh? How much is Goldman paying you to follow this blog and comment?

Oh, and Jace contributed $2,400 to the Obama campaign...from his address in Chicago.

Obama isn't dirty? Yup, and the Pope doesn't wear pantyhose.

Anonymous's picture

I wish I could understand all of this...

Anonymous's picture

I wonder if the stolen code actually proves the front running allegations and that's why they've gone absolutely bananas?

Anonymous's picture

I'll bet as much comes of this as the Japanese bearer bond guys, or the North Korean ship that was being tracked off the coast of China.

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.

Veteran's picture

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

dnarby's picture

Wasn't GS leasing tankers full of oil?

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

Anonymous's picture

So Misha left Citadel months ago, taking a bunch of high frequency traders with him, and because he hired Sergey Citadel is somehow involved? If there's anyone involved, it's Misha.

Wow, what utter rubbish you write and pretend to call news.

Anonymous's picture

"Wasn't GS leasing tankers full of oil?"

I am pretty sure those will be unloaded ahead of the herd.