Huffpost Technology
Gerry Smith Headshot

Bo Zhang Charged With Stealing Software Worth Millions From Federal Reserve Bank Of New York

Posted: Updated:
BO ZHANG
Getty Images

Authorities on Wednesday said they had charged a Chinese computer programmer with stealing proprietary software code from the Federal Reserve Bank of New York.

Bo Zhang, 32, of Queens, was arrested Wednesday by agents with the FBI and the Department of the Treasury Office of Inspector General, according to the FBI.

Between May and August of last year, Zhang worked as a contract employee assigned to develop source code for software used by the Federal Reserve Board of New York to track the federal government's finances, authorities said. The United States has spent nearly $10 million developing the code, according to court documents.

In July, Zhang allegedly copied the source code onto an external hard drive and downloaded it onto his private computers. Zhang told authorities he was using the code in connection with his private business where he trains computer programmers and wanted to ensure he still had the code if he lost his job.

Zhang is a Chinese national who arrived in the United States in 2000 and was working on a visa at the time of his arrest, authorities said. He graduated from University of Massachusetts Amherst with a degree in computer programming and previously worked as a computer programmer for Prudential, Bank of America and Goldman Sachs, authorities said. He faces a maximum of 10 years in prison.

"Zhang took advantage of the access that came with his trusted position to steal highly sensitive proprietary software," FBI Assistant Director-in-Charge Janice K. Fedarcyk said in a statement. "His intentions with regard to that software are immaterial. Stealing it and copying it threatened the security of vitally important source code."

His case highlights what security experts call the "insider threat" -- an employee working inside a company who steals intellectual property. In several recent cases, the employees have been Chinese nationals who were charged with stealing trade secrets for the benefit of the Chinese government.

FBI officials said Zhang did not appear to have stolen source code for the purposes of espionage.

all-related-on-huffpost

Suggest a correction

Around the Web

US charges man with stealing software from NY Fed

Man Said to Be Charged in Government Computer Data Theft

Regulatory failure datapoint of the day, Citigroup edition | Felix Salmon

Simon Johnson: Is the New York Fed Making a Big Mistake ...

NY Fed's Dudley: How to Fix Housing | Daniel Gross - Yahoo! Finance

From Our Partners