Prosecutors target ex-Samsung employee for leaking chip secrets to China

By Kuksung Nam, The Readable
Dec. 14, 2023 8:40PM GMT+9

A former senior employee of Samsung Electronics is facing criminal charges for allegedly transferring semiconductor-related technology from the South Korean tech-giant to a Chinese company. The nation has been grappling with the issue of trade secret theft over the past year amid a string of high-profile cases involving prominent employees of Samsung Electronics.

On December 13, the Seoul Central District Prosecutors’ Office applied for a warrant to take the former senior Samsung employee into custody for violating the nation’s industrial technology protection law. The accused, who has not yet been identified except by the last name ‘Kim,’ resigned from Samsung Electronics and later joined a Chinese semiconductor company in 2016. Prosecutors suspect that Kim transferred the “integral” semiconductor technology while he was employed at the Chinese firm.

The prosecutors further applied for a warrant to arrest Kim’s accomplice, an individual employed by a firm that partners with Samsung Electronics, for the crime of assisting Kim in leaking top secret information and technology to China. The officials did not explicitly name the company by whom the suspect was employed, but they did reveal the last name of the accused, which is ‘Bang.’ The court is expected to decide on December 15 on whether or not to approve the arrest warrant.

The Seoul Central District Prosecutors’ Office did not disclose further details. The Readable reached out to Samsung Electronics, but the tech giant declined to comment, explaining that the case is still being investigated.

According to the Dong-A Ilbo, prosecutors estimate that trillions of won (more than $800 billion) were lost due to South Korean trade secrets being transferred to China. The officials expect that the damage will grow more severe, as the crime will benefit Chinese companies over time by narrowing the technology gap between the tech giant, Samsung, one of the world’s biggest chipmakers, and Chinese companies who, otherwise, struggle to keep up with the industry leader. The prosecutors received the information about the criminals from the National Intelligence Service (NIS) in May of this year.

South Korea, which is known to be the home to major display panel makers and semiconductor manufacturers, is struggling to protect the nation’s core technology from theft as the high-tech crimewave continues.

In October, the Suwon District Prosecutors’ Office charged a former senior researcher of Samsung Electronics with stealing the company’s trade secrets concerning organic light-emitting diodes (OLEDs) and trying to transfer them to China through a company that the suspect had established. The officials stated that the stolen technologies were worth at least 340 billion won ($262 million). In June, a former executive of the tech giant was accused of allegedly stealing engineering data from the company’s semiconductor factory and attempting to build a duplicate plant in the Chinese city of Xi’an. The Suwon District Prosecutors’ Office assumed that the stolen information was worth at most trillions of won (more than $800 billion).

In response, the South Korean police conducted a nationwide operation from February to October in which they discovered more than 20 cases involving the alleged theft of trade secrets to be transferred to foreign countries. Sensitive information about displays was targeted most frequently, with 8 cases being uncovered. Confidential technologies on semiconductors and machinery came next, which turned up 3 cases. The suspects allegedly conducted unauthorized transactions of such classified technologies to countries such as China, Taiwan, Japan, the United States, Vietnam, Cambodia, Iraq, and Australia.

The cover image of this article was designed by Areum Hwang. This article was copyedited by Arthur Gregory Willers.

Kuksung Nam is a journalist for The Readable. She has extensively traversed the globe to cover the latest stories on the cyber threat landscape and has been producing in-depth stories on security and privacy by engaging with industry giants, foreign government officials and experts. Before joining The Readable, Kuksung reported on politics for one of South Korea’s top-five local newspapers, The Kyeongin Ilbo. Her journalistic skills and reportage earned her the coveted Journalists Association of Korea award in 2021 for her essay detailing exclusive stories about the misconduct of a former government official. She holds a Bachelor’s degree in French from Hankuk University of Foreign Studies, a testament to her linguistic capabilities.