Aleynikov, 39, started at Teza on July 2, the day before he was arrested, the firm said in an e-mailed statement today. Teza, co-founded by Misha Malyshev, a former trader at hedge fund Citadel Investment Group LLC, said it first learned of the allegations on July 5 and suspended Aleynikov without pay following an investigation.

The firm “was not aware of the alleged misconduct” and offered to cooperate with the government, according to the statement. James Margolin, a spokesman for the FBI’s New York Office, said the investigation is continuing.

Just when one thought it is possible to have a big scandal erupt, in which Chicago is named and not have Ken Griffin involved, the Citadel trail emerges. Contrary to previous rumors that Getco may have been the unfortunate firm to land Bond, Serge Bond, Misha Malyshev's new outfit, Teza Technologies, emerges with a bang. Teza, run by Misha, whom Zero Hedge has discussed previously , former Head of High-Frequency Trading at Citadel, together with another former teammate and recent Princeton grad (resume recently pulled from the interwebs), Jace Kohlmeier , announced that it had suspended Sergey without pay after learning of the allegations. From Bloomberg One wonders if the arrest of Sergey one day after his formal start at Teza was strangely coincident. It is easy to imagine that 85 Broad would like as little hi-fi competition in any way, shape or form, and Misha, whose group at Citadel was the only profitable one last year, would have likely presented just such a "challenge." Arguably Goldman was just waiting for the Teza confirmation before throwing a 10,000 page injunction against Teza to prevent the current group from ever trading 1 share of high-frequency traded SPY in their combined lifetimes, based on possible information that Sergey may have "leaked" to Misha and Jace. And another one bites the dust. Sphere: Related Content