HTC employees indicted for leaking trade secrets

The employees also allegedly received $1.1 million from kickbacks and phony expense reports, says The Wall Street Journal and The Taipei Times.

(Credit: Sarah Tew/CNET)

Six HTC employees have been indicted by Taiwanese prosecutors on charges that they revealed company secrets, accepted kickbacks, and made up false expense reports.

The Taipei District Prosecutors Office alleges that Thomas Chien, HTC's vice president for product design, and the other employees leaked the design for an upcoming HTC smartphone interface to outside suppliers, the Wall Street Journal reported on Friday. The employees had planned to use the leaked information to launch their own phone design company in Taiwan and China, according to the prosecutors.

Chien and the other HTC employees have also been accused of receiving $1.1 million in kickbacks and fake invoices from suppliers. The three people from the external suppliers are so far unidentified.

But The Taipei Times revealed the titles and names of the other indicted HTC employees as HTC research and development director Wu Chien-hung, HTC senior manager of design and innovation Huang Kuo-ching, senior manager of design and innovation Huang Hung-yi, manufacturing design department manager Hung Chung-yi, and employee Chen Shih-tsou.

Under Taiwan's newly-revised Trade Secrets Act, those found guilty of leaking trade secrets to China or other countries can receive as many as 10 years in prison and a fine of between $100,000 and $1.6 million, the Taipei Times said. If the guilty parties obtained more than $1.6 million illegally, the fine can rise to anywhere from 2 to 10 times higher than the amount of the illegal gains.

'The company expects employees to observe and practice the highest levels of integrity and ethics,' HTC said in a statement following the indictment. 'The company does not condone any violation.'