Ex-Samsung Official Accused of Attempting to Duplicate Chip Factory in China

The chip manufacturing industry has been declared an “all-out war” by South Korean President Yoon Suk Yeol, and recent developments have reinforced this statement. According to BusinessKorea, a former Samsung executive has been indicted by prosecutors in the Suwon District for allegedly stealing semiconductor plant blueprints and technology from the leading chipmaker. The defendant, who is 65 years old and previously served as vice president of another Korean chipmaker SK Hynix, is accused of stealing the information between 2018 and 2019. The leak is said to have cost Samsung approximately $230 million.

The defendant is allegedly planning to build a semiconductor plant in Xi’an, China, less than a mile from an existing Samsung plant. He hired 200 workers from SK Hynix and Samsung to obtain their trade secrets while partnering with an unnamed Taiwanese electronics maker that pledged $6.2 billion to build a new semiconductor plant — a partnership that collapsed. However, the accused received about $358 million from Chinese investors, which he used to create prototypes at a factory in Chengdu, China. According to the prosecutors, the factory was also built based on stolen Samsung data.

“It is so serious that it is difficult to compare it in terms of the scope of the crime and the degree of damage with previous isolated cases of semiconductor technology leaks,” the prosecutor’s office said in a statement. “It is a serious crime that can deal a heavy blow to our financial security by shaking the foundation of the domestic chip industry as competition in chip production intensifies.” Six co-conspirators, including one Samsung subcontractor, were indicted alongside the main accused. These charges come as a result of China’s continued efforts to acquire South Korean technology in a number of fields and South Korea’s tougher penalties for related crimes.