HTC Execs Allegedly Conspired to Steal Secrets, Flee to China
September 2, 2013 5:27 PM
comment(s) - last by
Top executives are accused of trying to start their own companies using stolen secrets
It's no secret that HTC Corp. (
to retain leadership
, as it has
cut executive pay
. As HTC
, first from the top five in global smartphone sales -- then
from the top ten
-- many have fled the sinking Taiwanese Android smartphone maker.
I. R&D Executives Reportedly Planned to Steal Upcoming Sense UI 6.0
Four top executives who were arrested this week in Taiwan and accused of stealing secrets from their hobbled employer. The suspects include Chien Chih-lin, vice general manager
of HTC R&D
; Wu Chien-hung, director of R&D; Huang Hung-yi, a senior R&D engineer; and Huang Kuo-ching, a lower level R&D manager.
The employees were apprehended this week following an investigation by Taiwan's Investigation Bureau; the nation's equivalent of the
U.S. Federal Bureau of Investigation
(FBI). At an initial hearing before the Taipei District Court, the two higher-ranking suspects -- Mr. Chien and Mr. Wu -- were ordered detained on suspicion of committing criminal violations of Taiwan’s Trade Secrets Act and Securities Exchange Act.
Chien Chih-lin, a top HTC R&D executive, is led away in handcuffs after allegedly stealing hundreds of thousands of dollars, plus trade secrets from his employer and planning to flee to China with co-conspirators. [Image Source: CNA]
Allegedly the R&D executives worked with Chinese government officials to steal secrets of HTC's upcoming smartphone technology. Some sources --
The Epoch Times
-- are reporting that the Sense 6.0 user interface firmware/software was amongst the technology stolen. Sense 6.0 is HTC's upcoming Android skin that is expected to be made available with latest Android phones later this year. The suspects reportedly planned to flee the country and launch their own firms with the technology they stole from their soon-to-be former employer.
The executives worked at HTC's Sindian District offices in New Taipei City, Taiwan's most populous city. Mr. Chien -- allegedly the group's ringleader -- had worked at HTC for 13 years and was a pivotal figure in developing HTC's flagship HTC One smartphone. Many employees were shocked to hear of his arrest.
II. Executive Also Embezzled $336,000 USD During HTC One Development
But reportedly Mr. Chien's criminal plans did not stop at merely stealing trade secrets. He is also accused of embezzling NT$10M (~$336,000 USD). Mr. Chien -- whose role often involved trips to the Chinese mainland and recruit Chinese subcontractors for developing smartphone components -- allegedly faked receipts for "outsourcing expenses" related to the development of the HTC One.
Taiwanese investigators reportedly found NT$6M (~$202,000 USD) of the cash stashed in his home and in his corporate reimbursement account. Another NT$1M (~$33,600 USD) was found in bank accounts of Mr. Wu and his wife. Prosecutors also report finding cell phone designs, charts, customer lists, and related data on computers and storage devices at the suspects’ houses.
Stolen HTC smartphone concept sketches were found on the suspects' computers.
[Image Source: AndroidAndMe]
The suspects have reportedly admitted that they planned to start their own rival firms and leave HTC, but denied that the data they took constituted "trade secrets". If the Taiwanese court system decides otherwise, though, the suspects could find themselves in serious trouble. The government of Taiwan recently revised the Trade Secrets Act to stiffen penalties; under the new rules the suspects could spend up to 10 years in prison.
Mr. Chien and Mr. Wu were both kept behind bars while awaiting trial as they are considered flight risks. Huang Hung-yi was released on a NT$300,000 bail ($10,000 USD), while Huang Kuo-ching was bailed on a NT$100,000 (~$3,360 USD) bond.
The R&D department's embarrassing crime saga is
the latest setback for HTC
failed to see a significant sales bump
flagship One smartphone
. HTC is hoping to rebound by targeting the Chinese market, a market where it
has been gaining traction
. Reports indicate HTC is
planning a new smartphone operating system
to target budget Chinese smartphone sales. HTC is also preparing to release a
5.9-inch phablet dubbed the "One Max"
. The company has warned that
a large loss may be upcoming for Q3 2013
The Epoch Times
This article is over a month old, voting and posting comments is disabled
RE: Safe to get HTC One?
9/3/2013 4:07:12 AM
Safe? Who cares? At the rate smartphones are outdated and replaced, even if HTC does go under, it's not like it will be a huge problem--since you'll probably be upgrading in just a couple years anyways.
"We shipped it on Saturday. Then on Sunday, we rested." -- Steve Jobs on the iPad launch
HTC is Reportedly Building a Smartphone OS Just for China
August 28, 2013, 10:40 AM
HTC's Peter Chou Draws Comparison to 80s Steve Job Amid Struggles
August 22, 2013, 8:03 AM
Beats Electronics Wants to Kick HTC to the Curb, Find New Investors
August 19, 2013, 12:28 PM
Quick Note: 5.9" HTC One Max Shown in New Photo
August 5, 2013, 9:03 AM
HTC Trainwreck Continues, Q3 Earnings Forecast Slashed 30 Percent
July 30, 2013, 9:00 AM
iPad Sales Shrink, Apple CEO Chides Hybrid Tablets, Android, and Microsoft
April 24, 2014, 1:38 PM
FDA Proposes Regulations, Health Warnings for Electronic Cigarettes
April 24, 2014, 9:00 AM
Apple Rakes in $10.2B Profit for Fiscal Q2; Announces 7-for-1 Stock Split
April 23, 2014, 4:39 PM
The Price is Right: OnePlus One Packs Hot Spec for Only $299
April 23, 2014, 3:37 PM
Google Unveils Solar Panel Lease Plan for Homeowners
April 23, 2014, 9:56 AM
Quick Note: Apple Invites Companies to “Copy” Its Environmental Record
April 22, 2014, 7:58 AM
Most Popular Articles
A Bug's Life: Female Cave Bugs Have Penises, Penetrate Males for Three Days
April 17, 2014, 7:20 PM
HTC Hires Former Samsung Marketing Chief Who Developed "Galaxy" Brand
April 18, 2014, 6:00 PM
NASA Finds "Habitable Zone" Planet Sized Similar to Earth
April 18, 2014, 3:13 PM
Dotcom Bomb: U.S. Case Against Megaupload is Crumbling
April 22, 2014, 6:00 PM
Thanks to Government Crackdown, Chinese "Porn Cop" Has Watched 600K Adult Videos
April 21, 2014, 12:00 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information