Chicago-based Citadel Securities LLC filed a lawsuit in London against GSA Capital Partners LLP for allegedly stealing a secret trading strategy while recruiting a senior trader, Bloomberg News reported, citing a case filed Dec. 16, 2019.
Citadel claimed that GSA Capital gained access to its trading plan called the "ABC Strategy" during attempts to hire Vedat Cologlu as a key member of their new high-frequency trading business. GSA communicated with Cologlu via text and WhatsApp messages to avoid detection, according to the report.
The ABC Strategy cost Citadel over $100 million to develop and generates more than $50 million a year from trading stocks in the U.S. and Europe, the report said.
After Citadel began conducting an investigation in June, Cologlu confessed to the firm's legal team that he had given the trading strategy plan to GSA Capital. He has since been suspended, according to the lawsuit, but a person familiar with the matter said he is no longer with Citadel, the report said.
GSA Capital agreed to shred the hard copies of Cologlu's plan after being confronted by Citadel about their conversations.
Citadel is now seeking damages from GSA Capital, as well as an injunction to stop them from using any of the confidential information. The company also wants GSA Capital to destroy all paper and computer copies of the information.