GlobalFoundries Faces $500,000 Sanction Fine, Risking Its $1.5 Billion in CHIPS Act Funding

[Nomad76]

GlobalFoundries faces a $500,000 fine from the US Commerce Department for breaching export controls by shipping $17.1 million worth of chips to SJ Semiconductor (SJS), a blacklisted Chinese firm affiliated with Semiconductor Manufacturing International Corporation (SMIC). The company made 74 unauthorized shipments between February 2021 and October 2022, delivering nearly 5,700 wafers. The chipmaker attributed the violation to a data entry error in its Oracle trade management system, where SJS was incorrectly recorded under a direct customer's shipping details. While SJS had previously handled GlobalFoundries' chips as a third-party assembly provider, both SJS and SMIC were placed on the Entity List in 2020 due to suspected military ties.

GlobalFoundries received a significantly reduced fine due to its voluntary disclosure and cooperation avoiding a potential fine of up to $34.2 million. "GlobalFoundries' voluntary self-disclosure (VSD) and extensive cooperation throughout the investigation resulted in a significant reduction in the monetary penalty, which is the main incentive of our VSD policies," said John Sonderman, director of the Office of Export Enforcement (OEE) within the Commerce Department. The incident comes as the company anticipates $1.5 billion in CHIPS Act funding for manufacturing expansion. For comparison, the department previously fined Seagate $300 million in April 2023 for shipping $1.1 billion worth of drives to Huawei.



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[qwerty_lesh]

WHOOPS

 

[maxfly]

The dreaded data entry boo boo.

 

[bonehead123]

"Bad boys, bad boys.....Whatcha gonna do.....Whatcha gonna do when they come for you ?"

a significant reduction in the monetary penalty, which is the main incentive of our VSD policies

SOOO... they self disclose & get a slap on their wrists, then get $1.5B in CHIPS money in return....usual back & forth bureaucratic nonsense.. how much you wanna bet that some of that money gets "lost" along the way, with no explanation or public disclosures whatsoever....

Here's a thought.... allocate/award the chips money, then withhold the fine amount & tell them they HAVE to make up the difference out of their own pockets BEFORE getting the CHIPS funds !

 

[windwhirl]

Here's a thought.... allocate/award the chips money, then withhold the fine amount & tell them they HAVE to make up the difference out of their own pockets BEFORE getting the CHIPS funds !

34 million dollars fine vs 1.5 billion awarded? GF would just write a check or wire the money and call it aday.

 

[Chomiq]

500k? That's a slap on the wrist. They probably knew what the possible fine can be so they arranged to have the "data entry error" in their DB.

 

[damric]

I wonder which chips? I thought gloflo couldn't produce better than 12nm, hence why none of the major designers bother using them anymore.

 

[windwhirl]

I wonder which chips? I thought gloflo couldn't produce better than 12nm, hence why none of the major designers bother using them anymore.

From GF's site, security/military chips for BAE Systems are at least one source of income. Other than that, they make money from a number of markets, so they probably supply a wide variety of chips to a bunch of companies everywhere since they seem to do pretty much any kind of lithography from 600nm to 14/12nm

 

[bonehead123]

From GF's site, security/military chips for BAE Systems are at least one source of income. Other than that, they make money from a number of markets, so they probably supply a wide variety of chips to a bunch of companies everywhere since they seem to do pretty much any kind of lithography from 600nm to 14/12nm

View attachment 370231

Yea I doubt they are gonna go hungry anytime soon, assuming no embezzlement, thefts, or gross mismanagement occurs

 

[Count von Schwalbe]

I wonder which chips? I thought gloflo couldn't produce better than 12nm, hence why none of the major designers bother using them anymore.

High-performance consumer and server chips, yes. However those are also some of the most expensive, so older/"worse" nodes are often used for industrial purposes.

Remember, most anything electronic is powered by embedded general-purpose chips nowadays. There were reports of companies buying washing machines to strip for chips during the worst of the shortages.

 

[ToTTenTranz]

I wonder which chips? I thought gloflo couldn't produce better than 12nm

IoT, automotive and network infrastructure are fine on 12nm (also what they announce in their website).

Though I wonder for how long GlobalFoundries is going to just stay on DUV. At some point they might become redundant due to all the state-sponsored Chinese IC production. Even 12nm is apparently only being done in New York and Dresden.

 

[damric]

Funny if they are smuggling those gloflo 12nm meanwhile uncle Pat can't seem to give away foundry time.

 

[Craptacular]

500k? That's a slap on the wrist. They probably knew what the possible fine can be so they arranged to have the "data entry error" in their DB.

The headline mentions they are risking billions of dollars from the chips act.

 

[Count von Schwalbe]

500k? That's a slap on the wrist. They probably knew what the possible fine can be so they arranged to have the "data entry error" in their DB.

A cynical view, but not impossible.

The point of the small fines is so that these companies do actually report it, rather than try to cover it up.

The headline mentions they are risking billions of dollars from the chips act.

Speculation, if well-founded speculation.

 

[kapone32]

Does Greed have any respect for Laws. Even given the Geo Political Situation?