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Meet "Ben Pu" - The Aleynikov Sequel: Quant Powerhouse Citadel Arrests Former Employee For Stealing "Alpha" Code
Chicago hedge fund Citadel may not have the best of luck when it comes to running traditional financial businesses (it's recent disastrous foray into advisory and capital markets - nuf said), but when it comes to picking up nickels and dimes ahead of slower traders (yes there is a name for it, but for lack of immediate legal retaliation by an uber-sensitive Ken Griffin we will leave it to our readers' imagination) by virtue of faster computers and a massive collocated infrastructure, Citadel is second to none (well, except maybe now infamous Latour Trading). Which explains why it is so sensitive to any former employees "borrowing" its special sauce, aka the computer code that is the only thing that gives the hedge fund its fro... er, superior trading execution. It was only last year that the fund went all Friend-O on Misha Malyshev, whose Teza technologies was implicated as the future employee of one now legendary Sergey Aleynikov. Well, it is time for a redux. As Dow Jones reports, "a former technology employee of hedge fund manager Ken Griffin's Citadel LLC was arrested for allegedly stealing sensitive computer trade secrets from the company for his own personal use, the Department of Justice said. According to the complaint affidavit, 24-year-old Yihao Pu, also known as "Ben Pu," was found by Citadel's information technology department to have "downloaded several unauthorized programs," which allegedly allowed him to bypass Citadel's security protocols and transfer files or data from his Citadel computer to an external storage device."
As for where this was found...
Certain files recovered from hard drives disposed in a sanitary canal near the Wilmette Harbor north of Chicago contained "alphas" or building blocks of Citadel's automated electronic trading algorithms and strategies. They also indicated that Pu was attempting to construct a trading strategy similar to the one used by Citadel, the affidavit said.
That's right: the sewer. That's how serious Citadel is when people go stealing their alpha shit: it will dig through.. well, you get the picture.
There was a time when being involved in finance meant lending and borrowing. Those days are gone. Now it is all about scalping milliseconds here and nanoseconds there.
And woe to whoever stands in the way of SkyNet.
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The Chinese are infiltrating. They've even taken over the LPGA tour.
He's climbin in your windows
He's snatchin your algos up
Tryna /sbin/dump -0u -f /dev/st0 /usr/src em so y'all need to
Hide your disks, Hide your drives. Hide your disks,
Hide your drives. Hide your disks,
Hide your disks, Hide your drives. Hide your /dev/null,
Cuz they're /sbin/dump -0u -f /dev/st0 /usr/src errbody out here
He forgot to wipe.
The drive.
Heyoooooo
Yeah, what are the odds of this evidence not being planted?
"Alpha" code for beta channel stuffing? The irony...
Yeah, no kidding. Found in the sewer?! Geez, not to mention, putting any hard disk or memory stick in the microwave for about 10 seconds would frazzle any data on the drive, regardless of where you flush it later. Note to self: never hawk your programming talents at Citadel.
No, It will not. You have to physically destroy the media containing the data. The blender for a memory stick, Tree-shredder for harddrives. Or burn them. But this takes time and preparation.
In the defence gear I worked with they had a "thermite pack": A sealed aluminium tube filled with thermite then routed to larger pouches of thermite around the secret bits. The case was high in magnesium too. Even then there was a $$$ "Hammer and Nail" tool permanently attached. Using the hammer on the "nail", one was supposed to punch out specific locations to smash the chips underneath, while being overrun and supposedly with the thermite ignition countdown running for assured destruction.
The microwave just fries the electronics on a HDD. Then They will take the platters out and plonk them in an identical HDD, which may be the best outcome for all parties concerned because this saves Them & You the inconvenience of putting you in some shithole like Bagram and rubberhosing the data out of you!
you can't wipe a drive...coercivity is so high on those that you will mechanically damage the platters before you actually erase the bits. You have to melt/burn the things
That stinks.
Pu was flushed from the inside.
There once was a boy named Pu
He worked for a fund but wasn't a Jew
So when the shit hit the fan
He quickly got canned
Due to hard drives found in doo-doo!
Their work belongs in the sewer.
Citadel security doesn't take crap from anyone.
Citadel generally is not an outfit to get on the wrong side of.
Banks are the only ones allowed to steal. Steal from them or crooksrus.com, look out.
So while TPTB scramble to track down Lulsec "cyber terrorists" who launch the occasional DDOS attack, here we have companies like Citadel that no longer have anything to do with sound financial analysis but are nothing more than institutionalized, subsidized, legalized hackers who seek to exploit the electronic medium of financial markets on the backs of the rest of the investing world. Not because they undertand fundamentals, or do rigorous analysis, but because they hire Chinese programmers to write their scam code. What a joke.
American Finance Association slogan: "We move bits around--and that's about fuck all. so you don't have to."
If he marries Karen Yu and she hyphenates her last name, she will be Mrs. Yu-Pu
Don't forget Fook Mi and Fook Yu!
http://www.youtube.com/watch?v=vj1SyWntdo4
.
Maybe he can go back to China to design sinking riverboats.
Ben Pu, meet Hu Flung Dung in Shawshank..
And don't forget Kum Fum Sum Yung Gai.
Probably related to Won Hung Lo...
Frontrunning and screwing retail investors adds SUCH value to our economy. We need more businesses like this, then surely the current robust recovery will only become more accelerated.
I remember when frontrunning was illegal. That was when the NASD back-office examiners had AEM on their laptops instead of tranny-porn.
When the SEC says they are "working hard" most people don't take their meaning properly.
too bad this was stopped as there were many Obamanits waiting to bankroll the startups that would bring 10s of yobs before the next donation cycle peaks.
eating our seed corn bichezzzzz
And I'm *sure* they compensated Mr. Pu fairly, from their point of view (giggle). Citadel is neither the first, nor the last hedge fund that's getting the rather expensive lesson that when it comes to programmers and quants, you have to pay to play and that means trader sized compensation and/or an equity stake for the programmer.
Get it, or go down in flames.
For are smart as some these people are it's suprising they throw out their hard drives into the sewer without writing zero's to them first. Hell, stick some magnets to the drive before you toss it out. Also, what the heck was it doing in the sewer and not his PC at home?
Mr. Pu thought it would be safer in the sewer, with his relatives.
smart and seeming white hot stupidity exist in all,,,,,that's humans for ya!
Most smart people are not smarter than "normal people" when working outside of their domain, but they naturally still think that they are smarter than everyone else; a common expert fallacy. Investment advisers and other salespeople *love* that trait in highly-paid people.
Maybe the guy was planning to sell each "alpha" for $20 million a pop to Huen Shue (well known chinese government agent)
Bullish for shit.
Here's the code right here:
while( Ponzi == true )
{
SPY->Buy( rand() % 100 );
// Ponzi = false;
}
Ben Pu
now works for Apple so they wont get much luck with apple employers, he redesign the code into the SIRI and now he does all his trades by simply speaking to an iphone
with a first name like Yihao, i woulda suggested he keep his name yeeeeehooowwpuuu! just for the piratical beuaty of it all
I hate to Pu Pu your idea, but with a name like that some may find it arrogant in a way, almost as if he thought his pu didn't stink.
Anyone remember Bang Dae Ho?
He and Ben are actually gay lovers and getting married in NYC this week. They will be hyphenating, something Bang Dae Pu-Ho has been looking forward to for a long time.
I've been hanging around sanitary canals for a long time and I've never found a hard drive filled with awesome algos. Must be digging through the wrong shit.
Yeah, I think on that Dirty Jobs show they had an episode about the Citadel Recovery Team (tm).
We should go back to the system based on 8's and 16' instead of pennies. That would throw a wrench into their operations
...and $2 brokers.
Sounds like ol' Ben was under constant surveillance...
Engineering and computer department at all banks are 99% asians with thick bifocals all stuffed in 2 floors in Jersey City.
Hard drives dumped into the Chicago River...Nice work....
A scuba-diving Rahm found them at the bottom while he was looking for some more voters for the next election
what was on them?
He should have thrown it in the same lake as OJ's knife and he would get of scott free!
<== OVER
<== UNDER
Will get more or less time than Raj Raj's 132 months?
[Hint: He stole from a Wall Strret firm]
I think right now this is 40% of the market....it is sure not the fundimentals....its computers vs computers...
There is no honour among thieves.
NO PU!
Pu's career must be going down the shitter...
Only problem is that when you get the alpha code, you need to have about $200 m of server power to run it.
It's the Chinese way, the student learns from the Master.
Besides, I thought it was OK for one thief to steal from another.
and there you have it. The Citadel admitting that they have software to front-run the stock market. This is akin to a drug dealer calling the cops and saying some criminal stole all their drugs. The SEC and FINRA are worthless piles of Ben Pu if they can't figure this one out.
I guess we'll have to come up with a new language that skynet is not aware of yet to fool the bastard, ebonics?
sanitary canal
WTF was it found by an Asian Carp?
A cute little techie Ben Pu
Took Citadel's code and he flew.`
The cheeky young pup,
Then set himself up
As "Ben Pu Du Flunt-Lunning fu Yu"
I wonder how Shaw protects the family jewels in his India operation?
www.deshawindia.com/
lol
http://www.wallstreetoasis.com/forums/de-shaw-background-check-process-s...
well, the real question is, does Pu know Bang Dae Ho?
Heard from a friend who worked in China for about four years that he hasn't met any Chinese who doesn't steal. Stealing is their second nature perhaps.
In an interesting sidebar "we have also learned he is currently working with the Department of Defense in an operation only known as 'Virtual Room Clearing.'" more details as they get it.
I wish I could be on this jury. "so you're saying Mr Pu 'stole' and by 'stole' you mean remembered a code that you use to time the market and make trades off of?" Fuck-a-doodle-doo. You should have paid that guy so much that he never would have left. Oh. You didn't want to and he went to a competitor to replicate the process? Eat donkey shit. Pay your employees more and they won't jump ship.
they may have found the hard drives near where the wedding scene was in The In-Laws w/ peter falk & alan arkin et al
so, that fits...
...he may have tossed them into the canal when he knew he couldn't make it to the sub...
automated trading platforms, no human involvement. It's like leaving a factory running 24/7 making an endless suply of product nobody uses just so you can say youre producing something.
Are the regulators afraid that if you shut down the Algo mills the market will cease to exist? It won't, it will just remove the ability for a stock to double in two months based on nothing but computers fighting over a fraction of a cent.
Mean while, back at SEC HQ and Holders office at DOJ...
"zzzzzzzzzz"
KG living up to his Loeb inspired gulag reputation. The idea that someone smart enough to work in their HFT unit would 1) dump code onto a thumb drive, 2) get tailed by some monkey, 3) dump the drive in a sewer when t could be physically destroyed instead 4) and right after another junior employee had been accused of same recently, is absurdly laughable. Sounds more like putting the squeeze on a soft target fobbed out H1B
Last year the newest employee at Citadel, Mr. Pu was fired for talking to a competitor.
Quoted from business insider.com
http://tinyurl.com/3lgmgds
This is insane, no wonder the market is the way it is. All it's doing is front running orders to make money faster than the trade coming in.