January 18, 2021
Image Released, Getty Images
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This case is a retrial of a previous case.
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A South Korean court has sentenced Samsung’s heir, Lee Jae Young, to two years and six months in prison over a bribery scandal.
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The ruling came as part of a retrial of a previous case involving the country’s former president, Park Geun-hee, who was also imprisoned on charges of bribery and corruption.
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Lee has been the de-facto president of Samsung since 2014.
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The ruling is likely to have implications for his future role at the tech giant.
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News of the ruling led Samsung shares to drop more than 4 percent before they partially started to recover.
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And my jail term would, at least temporarily, keep me from making the decision at the company.
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Experts say the ruling could create a leadership vacuum and hinder Samsung’s decision on large-scale investments in the future.
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“It is really a big blow and a big crisis for Samsung,” Kim Dae-jung, a business professor at Sejung University, told AFP.
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Lee took over the leadership of the company when his father, Lee Kun-hee, was hospitalized after suffering a heart attack in 2014.
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The elder Lee passed away last year, leading to speculation that there will be a change in Samsung as his heirs may have to sell some assets or a portion of the profits to cover the hefty inheritance tax bill.
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“Frequently involved in crimes”
According to the court ruling, Lee “actively bribed and tacitly requested the president to use her authority to assist in the smooth succession of his father” at the helm of Samsung.
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“It is extremely unfortunate that Samsung, the nation’s leading company and a proud global innovator, is repeatedly implicated in crimes whenever there is a change in political power,” read the ruling.
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Li was found guilty by a court of bribery, embezzlement and concealment of illegal proceeds worth about 8.6 billion won, or $ 7.8 million. It said the independent compliance committee that Samsung set up early last year was no longer effective.
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Li’s defense team expressed disappointment with the decision.
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Lee’s lawyer, Lee In Jae, told reporters, “The nature of this case is the former president’s abuse of power, in violation of corporate freedom and property rights. Given this nature, the court’s decision is regrettable.”
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Lee has already served time in detention, which is expected to count as part of the sentence, leaving him with 18 months left to spend in prison.
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Second trial battle
Lee ran into legal trouble even as he was on the cusp of becoming a leader of a global tech giant. He was arrested for the first time in February 2017 for his alleged role in a political scandal, and his relationship with companies linked to the then president of South Korea, Park Gun-hye.
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Samsung was accused of paying 43 billion won, or $ 37.7 million, to two nonprofits in exchange for political support, which was said to include support for Samsung’s controversial merger, which paved the way for Lee to become the final chairman of the major company.
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The deal needed support from the government-run National Pension Fund.
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The charges included bribery, embezzlement, concealment of assets abroad and perjury. Lee denies all these charges, saying that Samsung did not want anything in return.
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However, a court convicted him in August 2017 of the charges against him and sentenced him to five years in prison.
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In February 2018, the sentence was cut in half, and the Seoul High Court decided to suspend the prison sentence, which means that he is free.
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But the South Korean Supreme Court returned the case to the Seoul Supreme Court, which issued its final ruling on Monday.
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