Former Samsung executive accused of stealing data to build Chinese copycat chip plant

On Monday, South Korean prosecutors accused a former Samsung Electronics executive of stealing semiconductor data to build a Chinese copycat chip facility.

The 65-year-old former SK Hynix employee was arrested. From 2018 to 2019, he violated industrial technology protection laws and stole trade secrets to build a copy of Samsung’s semiconductor plant 1.5 kilometers from Samsung’s chip factory in Xi’an, China.

Prosecutors said an undisclosed Taiwanese company canceled more than a $6 billion (approximately 8 trillion won) investment in the ex-Samsung executive’s copycat chip plant project. Instead, he received funding from Chinese and Taiwanese investors to develop Samsung-based chip prototypes.

The indictment follows rising U.S.-China semiconductor tensions.

The suspect, a 25-year semiconductor industry veteran, founded two chip facilities in China and Singapore and hired over 200 semiconductor professionals from Samsung and SK Hynix in South Korea. Samsung could lose $233 million (300 billion won) from stolen data, according to prosecutors.

Prosecutors say the company tried to copy a semiconductor factory, not just semiconductor technology. “It is a serious crime that could deal a heavy blow to the foundation of the domestic semiconductor industry at a time of cut-throat competition for chip production,” the prosecutor said.

Six accomplices of the ex-Samsung official were indicted. Samsung declined comment.