On December 3, South Korean police stated that a former Samsung Electronics engineer had been arrested and referred to prosecutors for allegedly poaching core semiconductor talent from Samsung and leaking 20nm DRAM memory chip technology to Chinese companies.
According to Yonhap News, the Seoul Metropolitan Police’s Industrial Technology Security Investigation Team said today that the 64-year-old former Samsung engineer was arrested on suspicion of violating the “Occupational Stability Act” and was referred to the Seoul Central District Prosecutors’ Office.
The man is reported to have participated as a consultant in the establishment of Chengdu Gaozhen Company, while simultaneously founding a headhunting company in Korea. He allegedly poached core semiconductor engineers from Samsung Electronics, offering salaries two to three times higher, and helped “replicate” DRAM factories in China. In April 2022, he successfully produced semiconductor wafers at the facility.
This DRAM factory went from construction to production in just 1 year and 3 months, while typically, it takes 4 to 5 years for wafers to go from testing to mass production.
South Korean police stated that the economic value of the leaked technology is estimated at 4.3 trillion Korean won (approximately 30.4 billion USD), and if related economic effects are considered, the actual losses are even larger.
In addition to the former engineer, two headhunting company representatives and legal entities who also poached South Korean semiconductor talent using the same methods have been referred to the authorities. It is reported that the headhunting company has poached more than 30 technical personnel.
Despite the outflow of South Korea’s key technologies, police could only arrest the suspects under the “Occupational Stability Act,” which carries lighter penalties, instead of the “Industrial Technology Protection Act.”
Police explained that under the current regulations, poaching of talent for the outflow of technology is not covered by the penalties outlined in the “Industrial Technology Protection Act,” and therefore, there is a need to amend the law to impose stricter penalties on industrial espionage.
The report indicated that 21 individuals, including the former Samsung engineer, have been referred to the authorities in connection with the technology leak case.
The founder of Chengdu Gaozhen, former Samsung Electronics executive and former SK Hynix vice president Choi Jin-seok, and others have already been arrested for violating the “Industrial Technology Protection Act” and the “Unfair Competition and Trade Secret Protection Act.”
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