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Ex-Samsung Exec Faces Data Theft Charges in China Factory Plot

The former Samsung Electronics chief allegedly planned to build the chip factory just a mile away from the Korean giant’s manufacturing hub in Xian

A Samsung sign is seen at the Korean company's centre in Manhattan, New York
A Samsung sign is seen at the Korean company's centre in Manhattan, New York. Photo: Reuters


South Korea has charged a former Samsung Electronics executive with being part of a plan to steal the company’s technology to build a chip factory in China.

The defendant, who also formerly worked at SK Hynix as a vice-president, is accused of illegally acquiring Samsung data to help build a factory in the Chinese city of Xian between 2018 and 2019, the Suwon District Prosecutors’ Office said in a statement.

The trial date was yet to be confirmed by the local court where the indictment has been filed. The defendant, arrested last month, is denying the allegations, a prosecutor said.

He worked a combined 28 years at the South Korean chipmakers, prosecutors said. The officials did not identify the accused.


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The former Samsung executive allegedly tried to build the factory 1.5 km (1 mile) away from Samsung’s chip manufacturing facility in Xian after setting up a semiconductor company, prosecutors said.

The attempt to build the new plant using Samsung data, however, ended in failure due to funding issues, a prosecutor said.

Prosecutors said on Monday they have also indicted six other people for their involvement in the alleged crime, including an inspection company employee who is accused of leaking the architectural plan of Samsung’s semiconductor factory.

Prosecutors said they estimated the theft of the data to have inflicted at least 300 billion won ($233 million) worth of losses on Samsung Electronics.


Chip Industry ‘All-Out War’

“It’s a grave crime that could deal a heavy blow to our economic security by shaking the foundation of the domestic chip industry at a time of intensifying competition in chip manufacturing,” the prosecutors’ office said.

Samsung Electronics and SK Hynix declined to comment.

The indictment comes as South Korea has vowed to step up support for its chip sector.

South Korean President Yoon Suk Yeol has described competition in the industry as an “all-out war” amid heightened Sino-US tensions.

South Korea’s Samsung and SK Hynix, the world’s top two makers of memory chips, have invested billions of dollars in chip factories in China.


  • Reuters with additional editing by Sean O’Meara


Read more:

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Samsung to Pump $230 Billion Into ‘World’s Largest Chip Base’

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Sean O'Meara

Sean O'Meara is an Editor at Asia Financial. He has been a newspaper man for more than 30 years, working at local, regional and national titles in the UK as a writer, sub-editor, page designer and print editor. A football, cricket and rugby fan, he has a particular interest in sports finance.


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