Lee Jae Yong: Samsung beneficiary gets jail term for bribery scandal

Samsung successor Lee Jae Yong has been sentenced to two years and six months in prison by a high court in South Korea.

The bribery case is a retrial of an earlier one including the nation’s previous President Park Geun-hye, who was likewise imprisoned for bribery and corruption.

Lee has actually been the de facto head of Samsung Electronics considering that 2014.

The judgment is most likely to have ramifications for the future of his role at the tech giant.

News of the sentence sent out Samsung electronics shares more than 4% lower prior to they began to claw back some ground.

Lee’s jail term will a minimum of momentarily side-line him from choice making at the conglomerate.

Professionals state the sentence might develop a leadership vacuum and obstruct Samsung’s decision-making on future large-scale financial investments.

” It’s truly a big blow and a big crisis for Samsung,” Kim Dae-jong, a business teacher at Sejong University, told news agency AFP.

Lee assumed leadership of the company when his father Lee Kun-hee was hospitalised following a heart attack in 2014.

The older Lee passed away last year, causing speculation that there would be a shake-up at Samsung as his beneficiaries could be forced into possession sales or dividend payments to cover a huge estate tax bill.

‘ Consistently associated with crimes’

According to the court’s verdict, Lee “actively provided kickbacks and implicitly asked the president to utilize her power to assist his smooth succession” at the head of Samsung.

” It is extremely regrettable that Samsung, the country’s top business and happy global innovator, is consistently involved in criminal offenses whenever there is a modification in political power.”

The court discovered Lee guilty of bribery, embezzlement and concealment of criminal profits worth about 8.6 billion won ($7.8 m; ₤ 5.75 m), and stated the independent compliance committee Samsung set up early last year has yet to become fully reliable.

Lee’s defence team expressed disappointment with the decision.

“The nature of this case is the previous president’s abuse of power breaking corporate liberty and property rights. Given that nature, the court’s decision is regrettable,” Lee’s attorney, Lee In-jae, told reporters.

Lee has currently served time in detention which is expected to count toward the sentence – leaving 18 months to be served.

Second court fight

Lee dealt with legal troubles even as he stood on the cusp of becoming the leader of the international tech giant.

He was first apprehended in February 2017 over his supposed role in a political and business scandal linked to South Korea’s then-president, Park Geun-hye.

Samsung was accused of paying 43bn won ($37.7 m; ₤ 26.7 m) to two non-profit foundations run by Choi Soon-sil, a good friend of Park’s, in exchange for political support – alleged to consist of backing for a controversial Samsung merger which led the way for Lee to become ultimate head of the conglomerate. The offer required support from the government-run nationwide pension fund.

Charges against Lee included bribery, embezzlement, hiding properties overseas and perjury – all of which he denied, stating Samsung did not desire anything in return.

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However in August 2017 a court convicted him of the charges and sent him to prison for 5 years.

In February 2018, that sentence was halved, and the Seoul High Court decided to suspend the jail term, implying he was totally free to go.

The Supreme Court then sent out the case back to the Seoul High Court, which issued Monday’s judgment.

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