Thread: Does Man Charged With Fed Reserve Source Code Theft Have Questionable Citizenship?

Does the Man Charged With Federal Reserve Source Code Theft Have Questionable Citizenship?

Posted on January 20, 2012 at 1:06pm by Liz Klimas

This week, Bo Zhang, a man who was a third-party contract programmer working for the Federal Reserve of New York, was charged with stealing $9.5 million worth of source code that prosecutors said, according to Bloomberg, “track[s] the billions of dollars that are electronically transferred every day in the U.S.’s general ledger.”

Zhang, who was arrested Wednesday, was charged with one count of stealing government property.


The Treasury spokesperson Matt Anderson is reported as saying that no data, personal information or transactions were compromised in the source code theft. Where the issue may get sticky is over the prosecutors accused reasoning for Zhang‘s theft and Zhang’s citizenship. Bloomberg reports the New York federal prosecutors as stating that Zhang took the code for “private use [...] in the event that he lost his job.” Joseph Grob, Zhang’s lawyer, had no comment over whether Zhang was a naturalized U.S. citizen or still a citizen of China, according to Bloomberg. Bloomberg also states that Chinese Foreign Ministry Spokesman Liu Weimin said he had no knowledge of the case.


According to Reuters, Zhang worked for an unnamed technology consulting firm and was brought on to develop unrelated source code for the New York Federal Reserve. Reuters reports that Zhang claimed to have lost a thumb drive with the code for the Government-wide Accounting and Reporting Program in July 2011, but when questioned by authorities in August, admitted to taking it.
Zhang will appear in court again on Feb. 17.

Man Charged With Stealing $9.5 Million Worth of Federal Reserve Source Code | TheBlaze.com

Bo Zhang Charged with Stealing Software Worth Millions From Federal Reserve Bank of New York

January 18,2012


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

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