TSMC cans seven employees who allegedly leaked confidential information to third parties

By Scott Marlette Last updated Sep 23, 2021

Leaks. Consumers love to read about them while company executives hate them. Just yesterday, we told you about an email that Apple CEO Tim Cook sent out to the company’s employees. In the missive, Cook wrote that Apple is doing “everything in our power to identify those who leaked,” and added that “people who leak confidential information do not belong” at Apple.

TSMC employees know plenty of information about Apple’s demand for chips

On Wednesday, the company that takes Apple’s chip designs and turns them into the components found in its products, TSMC, handed out pink slips to seven employees after alleging that they leaked confidential information. TSMC is the world’s largest independent foundry and Apple is its largest customer. According to Worldakkam (via 9to5Mac), the seven employees fired were caught leaking confidential information about TSMC’s customers.

TSMC let seven employees go for leaking confidential information

TSMC’s rules covering employee investments were said to be violated by the employees. The seven also failed to comply with the foundry’s work schedules.

The chip maker said that the workers fired were canned because they violated the company’s “core values.” One report said that the information leaked involved chip orders placed by the foundry’s customers and was passed along to outsiders. In a statement, the company said, “TSMC always operates on the company’s most important principles of integrity and integrity, so employees must follow these core values when working for the company. In the future, TSMC will continue to follow these principles and require all employees to do the same.”

The seven employees let go by TSMC worked in various departments and those involved had different reasons for leaking the information. Due to a sketchy translation, one local media report said that one of the fired employees was either running a department involved with equipment, or he worked at the foundry as an engineer.

TSMC is believed to have 56,000 employees and it has let workers go in the past for leaking trade secrets. But the largest number of employees it has fired at one time for such an offense was no more two which means that the seven employees fired was the largest number it has punished for leaking at one time.

With Apple responsible for about half of the foundry’s business (related to the production of the A-Series and M-Series chips), the odds favor that at least some of the information leaked by the fired employees pertains to the tech giant. And with Apple trying to crack down on leakers, it only makes sense that the company’s supply chain would be too. Earlier this year Apple’s contract manufacturers like Foxconn and Wistron ran criminal background checks on assembly line workers under the theory that they would be more apt to sell their access to Apple devices.

Investors could used leaked information to trade the shares of TSMC’s customers like Apple and Qualcomm

TSMC recently announced a delay in the manufacturing of chips using its 3nm process node. The latter was expected to be used to churn out the Apple A16 Bionic chip that we expect to drive next year’s iPhone 14 series. Instead, TSMC will use the 4nm process node which theoretically wouldn’t deliver the same improvements in performance and energy-efficiency that a 3nm chip would.

Any information about customer orders could be exploited by investors who might be able to use the information to determine demand for products made by TSMC’s customers, Apple included. it also could give away secret information about TSMC’s own business prospects. Besides Apple, other companies that use TSMC to produce their chips include AMD, MediaTek, Intel, Qualcomm, and more.

At one time, Huawei was TSMC’s second largest customer after Apple. The foundry turned out the Kirin chipsets designed by Huawei’s own HiSilicon semiconductor subsidiary. But a change in U.S. export rules prevents foundries using U.S. technology from shipping cutting-edge 5G chipsets to the manufacturer.

Behind TSMC, Samsung Foundry is the second largest foundry on the planet and has been right behind TSMC in terms of process node capabilities.

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