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I'm organizing a full team to do a remote project, yet my client want to keep his programs on the Hush Hush and make sure that it would not be possible to transmit code to his competitors. He also believes that in order to have successful team, they should have the full scope of the project and have access to all the code. Which means bring up the code into small project is not a solution he necessarily want to deal with. So of course one step is to make sure that the entire project seats on his server, but I’m wondering how do we take the next step in security.

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If they can read it ... they can copy it. – Zypher Jul 12 '11 at 19:48
And a useful corollary might be: "If they can't copy it, they can't work on it". (Do any developers NOT use copy & paste?) Also: "If you don't trust them, don't let them work on it." – Christopher Karel Jul 12 '11 at 19:58
I would asking this question on and I would not mark this for migration because this question should live here for the technical aspects of how do do this. However, onstartups would be a good place to discuss if you should, and their might be value asking this on programmers. – Justin Dearing Jul 13 '11 at 16:32

The only ways you can deal with securing the intellectual property here is to sequester all of your programmers in a concrete bunker with only one (tightly controlled) communication link to the surface. Have them complete the assigned project, take the code and then fill the bunker with concrete.
(To be clear: DO NOT remove the developers.)

Oh - you wanted a serious answer? In that case, NDAs, non-compete agreements, and lots of lawyers. Also, treat (and pay) them very well.

As Zypher and Christopher pointed out if someone can see code they can copy it, and if they can't see it they can't work on it effectively (even if you compartmentalize someone needs to know the overarching vision and be able to communicate it to each of the sub-teams, and eventually ideas/knowledge will need to bleed across the project's boundaries in order for things to grow/develop efficiently.

You can't really eliminate the possibility that someone will exfiltrate sensitive data/code/ideas, but you can certainly make it unattractive/undesirable for them to do so (through a combination of making the working environment somewhere they wouldn't want to leave/be kicked out of, and making sure that if they do get kicked out for exfiltrating data/ideas the legal consequences are dauntingly unpleasant.

(Note that said legal consequences probably won't undo any business harm - it's more a deterrent to the employee exfiltrating stuff rather than a recovery recourse.)

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