FOR IMMEDIATE RELEASE
PRESS CONTACTS:
WEDNESDAY SEPTEMBER 28, 2011
AUSA Barry Jonas
312-886-8027
www.justice.gov/usao/iln
AUSA Paul Tzur
312-697-4032
Randall Samborn
312-353-5318
FORMER CME GROUP SOFTWARE ENGINEER INDICTED FOR THEFT OF GLOBEX
COMPUTER TRADE SECRETS WHILE ALLEGEDLY PLANNING BUSINESS TO IMPROVE
ELECTRONIC TRADING EXCHANGE IN CHINA
CHICAGO - A former senior software engineer for Chicago-based
CME Group, Inc., was indicted today for allegedly downloading and
removing computer source code and other proprietary information
while at the same time pursuing business plans to improve an
electronic trading exchange in China. The defendant, Chunlai Yang,
who was arrested in July, was charged with two counts of theft of
trade secrets in an indictment returned by a federal grand jury,
announced Patrick
J. Fitzgerald, United States Attorney for the Northern District
of Illinois, and Robert D. Grant, Special Agent-in-Charge of the
Chicago Office of the Federal Bureau of Investigation.
Yang, 48, of Libertyville, was released on a $500,000 secured
bond following his arrest on July 1 after being charged in a
criminal complaint. He will be arraigned on a date to be determined
in U.S. District Court. The indictment seeks forfeiture of
computers and related equipment that were seized from Yang.
"This case is an excellent example of how law enforcement and
corporations can work together to protect trade secrets. CME Group
brought this matter to the attention of federal
authorities and fully cooperated with the investigation.
Economic espionage is a crime that effects
both the interests of corporations and our national interest in
protecting intellectual property. We will continue to working
collaboratively with the private sector to investigate and
prosecute trade secret theft," Mr. Fitzgerald said.
According to the indictment, Yang began working for CME Group in
2000 and was a senior software engineer at the time of his arrest.
His responsibilities included writing computer code and, because of
his position, he had access to the software programs that supported
CME Group's Globex electronic trading platform. Globex allowed
market participants to buy and sell exchange products from any
place at any time. The source code and algorithms that made up the
supporting programs were proprietary and confidential business
property of CME Group, which instituted internal measures to
safeguard and protect its trade secrets.
Between Dec. 8, 2010, and June 30, 2011, Yang allegedly
downloaded more than 1,000 computer files containing CME computer
source code from CME's secure internal computer system to his
CME-issued work computer; he then transferred many of these files
from his work computer to his personal USB flash drives; and then
transferred many of these computer files from his USB flash drives
to his personal computer located at his home. During the same time,
Yang also downloaded and printed numerous CME internal manuals and
guidelines describing how many of the computer files that comprise
Globex operate and how these computer files interact with each
other, the indictment alleges.
Yang and two unnamed business partners, identified as
Individuals A and B, allegedly developed business plans to form a
business referred to as the Tongmei (Gateway to America) Futures
Exchange Software Technology Company (Gateway), with the purpose of
increasing the
2
trading volume at the Zhangjiagang, China, chemical electronic
trading exchange (the Zhangjiagang Exchange). The indictment
alleges that Yang was to become Gateway's president, and he
allegedly engaged in contract negotiations on behalf of Gateway
with the Zhangjiagang Free Trade Board for Gateway to provide
computer source code to the Zhangjiagang Exchange.
Yang allegedly expected that Gateway would provide the
Zhangjiagang Exchange with technology to allow for high trading
volume, high trading speeds, and multiple trading functions. To
help the Chinese exchange attract more customers and generate
higher profits, Gateway proposed to expand the capabilities of
Zhangjiagang's software by providing customers with more ways of
placing orders; connecting the exchange's database storage system
and matching systems; rewriting the trading system software in the
JAVA computer programming language; raising the system's capacity
and speed by modifying communication lines and structures; and
developing trading software based on the FIX computer coding
language, the indictment alleges.
CME Group has fully cooperated with the investigation.
Each count of theft of trade secrets carries maximum penalty of
10 years in prison and a $250,000 fine. If convicted, the Court
must impose a reasonable sentence under the advisory United States
Sentencing Guidelines.
The government is being represented by Assistant United States
Attorneys Barry Jonas and Paul Tzur.
The public is reminded that an indictment contains only charges
and is not evidence of guilt. The defendant is presumed innocent
and is entitled to a fair trial at which the government has the
burden of proving guilt beyond a reasonable doubt.