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Stolen Semiconductor Technology Worth 624 Billion Won Almost Leaked to China

Stolen Semiconductor Technology Worth 624 Billion Won Almost Leaked to China

Posted July. 16, 2005 03:05,   


Seven former employees of Hynix Semiconductor were found to have attempted to set up a semiconductor chip factory in China to capitalize on state-of-the-art chip manufacturing process technology they had stolen from the former employer. Hynix invested 624.5 billion won in developing the technology.

The high-tech crime investigation department of the Seoul Central District Prosecutor’s Office (Superintendent, public prosecutor: Lee, Seung-sub) announced on July 15 that the prosecution detained and indicted five alleged industrial spies and indicted two others without physical detention on the charges of stealing chip manufacturing process technology (the violation of the law on prevention of unfair competition and protecting business secrets). They are employees of LMNT, a venture company, including the company’s vice president, Kim (46).

According to the police, Kim set up a paper company (a company which exists only on paper) named LMNT in Cayman Islands, a tax haven, in March 2004 after retiring from Hynix semiconductor in May 2003. He is accused of asking six former colleagues who were still working at Hynix including Mr. Woo to steal chip manufacturing process design documents and manufacturing process technology information.

With an aim to build a semiconductor factory in China, Kim offered a package of “an annual salary of 70-100 million won, plus stock options” to Woo, who was being paid 50-60 million won annually, for a position in his company.

Woo, then a manager, stole fifteen CDs containing core semiconductor technology in May and June last year and joined LMNT.

It was a technology that a total of 200 Hynix workers worked to develop for two years beginning in 2002, costing the company 624.5 billion won.

Kim built a paper company in the Cayman, considering that it would not be easy to raise investment capitals in China because of difficulties in recouping investments there.

Lee said, “No technology was leaked to China because we had launched our investigation based on the intelligence we had secured even before they set up the company.”

Meanwhile, the prosecution indicted three former employees including former executive Kim of IT Magic, a venture company, without physical detention on charges of stealing voice recognition and sound enclosure software technology.

Jin-Young Hwang buddy@donga.com