Samsung executive faces jail sentence

The chief executive of Samsung Electronics’ US-based chip division is facing 10 months behind bars after pleading guilty on Thursday to price-fixing charges.

The Korean executive, Park Young-hwan, was involved in a wide-ranging conspiracy involving Samsung and other makers of dynamic random access memory components – or D-Ram chips – while he served as vice-president of the Korean company’s sales division.

Mr Park is the fifth Samsung executive to agree to a prison sentence in the Justice Department’s investigation, which has also ensnared four Hynix executives, four officials at Infineon, and resulted in one obstruction charge against a regional sales manager at Micron Technology. The probe has generated $730m in criminal penalties from the parties involved, the second-highest number of fines to emerge from any single price-fixing conspiracy.

According to Samsung’s website, Mr Park has served as president and chief executive of Samsung Semiconductor in the US since March, 2004, leading the industry’s second highest-volume supplier of chip products in North America. The website also credits Mr Park for leading the company’s memory sales team at a time, between 2001 and 2003, when it saw its “most dramatic growth”.

The Justice Department said Mr Park carried out the price-fixing conspiracy from April, 2001 to June, 2002 by participating in meetings and conversations with rivals in the D-Ram market and agreeing to charge certain customers a fixed price. The talks ultimately affected sales to US computer makers such as Dell, HP and Compaq.