Chinese Programmer Charged With Stealing Source Code from Federal Reserve Bank of New York

A Chinese computer programmer was arrested by U.S. authorities in New York on Wednesday, on charges that he stole proprietary source code while working on a project at the Federal Reserve Bank of New York.

Bo Zhang, 32, of Queens, New York, has been charged with stealing source code from a system known as the “Government-Wide Accounting and Reporting Program” (GWA), a software system owned by the Department of the Treasury that is used mainly to manage central accounting and reporting functions and processes associated with budget execution, accountability, and asset management.

Among other things, the GWA provides federal agencies with an account statement—similar to bank statements provided to bank customers—of the agencies’ account balances with the United States Treasury. The United States has spent approximately $9.5 million to develop the system.

Zhang worked as a contract employee developing a specific portion of the GWA’s source code at the Federal Reserve Bank of New York where the source code is maintained in an access-controlled electronic environment.

The complaint alleges that in the summer of 2011, Zhang stole the GWA code, something he admitted to in July 2011.

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According to the complaint, while working at the FRBNY, he accessed and copied the code onto a hard drive at the FRBNY, then copied it onto an FRBNY-owned external hard drive. He then connected that external hard-drive to his private office computer, his home computer, and his laptop.

Zhang said that he used the GWA Code in connection with a private business he ran training individuals in computer programming.

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

Zhang faces up to 10 years in prison and a fine up to $250,000, or twice the financial gain derived from the offense or twice the gross financial loss to the victims.

“As today’s case demonstrates, our cyber infrastructure is vulnerable not only to cybercriminals and hackers, but also alleged thieves like Bo Zhang who used his position as a contract employee to steal government intellectual property,” commented U.S. Attorney, Preet Bharara in a statement. “Fighting cyber crime is one of the top priorities of this office and we will aggressively pursue anyone who puts our computer security at risk.”

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