Semiconductor Material Firm Indicted for Massive 350 Billion Won Collusion Despite Client Price-Cut Requests

A semiconductor material company suspected of engaging in collusion worth around 350 billion won has been handed over to trial.

The Seoul Central District Prosecutors' Office's Criminal Proceeds Recovery Department (led by Chief Prosecutor So Jeong-su) announced today (August 13) that it has indicted five individuals, including the current and former CEOs and executives of semiconductor material firm Company A, as well as the corporate entity itself, without detention on charges of violating the Fair Trade Act.

According to prosecutors, Company A is accused of colluding with competitors on prices and trading conditions while supplying semiconductor materials, namely bonding wires and solder balls, from April 2020 to December of last year.

Bonding wire is a fine metal wire that electrically connects a semiconductor chip to a substrate, while a solder ball is a microscopic metal sphere that electrically and physically connects a semiconductor chip to a substrate.

The total scale of the collusion is estimated to have reached approximately 347.6 billion won, comprising 306.9 billion won in bonding wires and 40.7 billion won in solder balls.

Investigations revealed that as profitability deteriorated due to rising raw material costs such as gold and intensifying market competition, Company A conspired with competitors by agreeing on price hikes or jointly responding to clients' requests for price cuts by agreeing to freeze prices.

Regarding the 1.22 billion won in criminal proceeds confirmed to have been acquired by Company A, prosecutors requested a provisional attachment of real estate owned by the company, which the court accepted on July 31.

Prosecutors explained that this is the first case in which criminal proceeds were provisionally seized using price collusion under the Fair Trade Act as a predicate offense.

After initiating a direct investigation, prosecutors exercised the Prosecutor General's right to request a formal accusation from the Fair Trade Commission (FTC). Taking over the case, they uncovered through search and seizures and questioning of relevant parties that Company A had spearheaded the collusion, leading to the indictment.

An official from the prosecutors' office stated, "Although prosecutors will fundamentally be barred from investigating collusion cases after October 2, we will do our utmost until the very end to eradicate collusion through rigorous trial maintenance and the recovery of criminal proceeds."
※ Please note: This article was translated by AI and may contain errors.