Ex Samsung Execs Arrested for Suspected Intellectual Property Theft in Chip Manufacturing

Arrests in South Korea over IP Theft

Two former Samsung employees have reportedly been caught up in a major intellectual property scandal. Arrested under suspicion of stealing over $3.2 billion in intellectual property, the duo intended to utilize the stolen technology in their own chip factory in China.

The Chengdu Gaozhen Scheme

A joint venture in China, Chengdu Gaozhen, is allegedly the brainchild of the pair in collusion with Chinese officials. A key part of this venture’s plan was to siphon Samsung's 20-nanometer chip technology and other company secrets. The police estimate the cost of these stolen technologies to be around ₩4.3 trillion ($3.2 billion).

Suspects' Role in Chengdu Gaozhen

One of the accused individuals, a former senior researcher at Samsung Electronics, is said to have landed a prominent position at Chengdu Gaozhen. He is currently under investigation for allegedly stealing Samsung technology for the Chinese undertaking.

Is This Case Related to a Previous Incident?

Given the recurring nature of such incidents involving alleged Chinese spies, it remains to be seen whether these arrests are connected to a similar prosecution in a South Korean court last year. Another former Samsung executive was prosecuted last year for stealing proprietary information from Samsung to establish a chip fabrication unit in China.

Rampant Chip IP Theft

Intellectual property theft, particularly related to chip technology, is becoming increasingly rampant around the globe. In addition to the United States, South Korea has been grappling with the theft of chip secrets; in their case, the culprit is suspected to be North Korea. The current environment suggests that the issue may not resolve in the near future.