So basically there should have been several unbiased experts brought in before he was arrested to determine if the code truly contained any trade secrets?
I think that the government should be liable for all reasonables damages caused by police investigations. Not just here, but in general - it's obvious the police use investigation as a form of blackmail at occasion, and that's just wrong. As part of a conviction, some of those damages might be voided to the degree the damage was necessary and proportional to the crime.
Also, from the point of view of efficiency in society, this is a particularly nasty cost since its borne not by those that cause it (the officers), nor by those hiring them (the government), nor is it ever accounted for as a loss. I think this encourages malpractice. Certainly if you observe how the police go about enforcing the law once they've decided somebody is guilty in their own eyes there doesn't seem to be any kind of restraint whatsoever. To the extent they can, they're single-party judge, jury and enforcement in one, exactly the kind of thing the idea of a justice system is supposed to prevent.
I'm not an expert at all, but sounds like that would've definitely helped.
The author, Michael Lewis, actually conducted an informal trial in a restaurant, with (neutral) HFT experts, who were even more furious than Serge was when they learned how he'd been treated.
I wouldn't be surprised if non-technical executives in Goldman simply saw a Russian leaving for a competitor, and assumed he was stealing valuable secrets without investigating properly.
Worst part is, even after the details become apparent (see other comments here), Goldman or the FBI are completely unable to admit any fuck ups, and continue hounding him.
How the hell does anyone determine that? If someone walked out of Id during Quake III development with Carmacks's inverse square root (http://stackoverflow.com/questions/1349542/john-carmacks-unu...), would that be a trade secret? It's not like an inverse square root is a secret, but what about doing it faster than anyone else?? Writing the best 3D engine was part of their success, and writing the fastest order routing/exchange is a big part of HFT. He took source code from GS to go to a competitor that had offered him a lot of money, it's hard to have much sympathy for the guy.
Also, from the point of view of efficiency in society, this is a particularly nasty cost since its borne not by those that cause it (the officers), nor by those hiring them (the government), nor is it ever accounted for as a loss. I think this encourages malpractice. Certainly if you observe how the police go about enforcing the law once they've decided somebody is guilty in their own eyes there doesn't seem to be any kind of restraint whatsoever. To the extent they can, they're single-party judge, jury and enforcement in one, exactly the kind of thing the idea of a justice system is supposed to prevent.