nsucurrent.com February 20, 2018

Samsung chief get prison time in $6.4m bribery scandal

26 August 2017, 01:17 | Ruby West

Ahead of Lee verdict Samsung Group lacks leadership 'Plan B'

Ahead of Lee verdict Samsung Group lacks leadership 'Plan B'

Samsung will have to operate without its acting leader for a few years, now that a South Korean court has found Lee Jae-yong guilty of bribery and embezzlement.

Prosecutors had demanded that Lee be handed a 12-year jail term for giving or promising as much as 43 billion won in bribes to benefit Park's long-time friend and confidante Choi Soon-Sil, in exchange for government support of his management succession.

Lee Jae-Yong's paid a total of $7.9 million United States dollars in return for favors including government support for Lee's hereditary succession.

Lee's lead attorney Song Wu-Cheol said that he and the remaining teams are going to appeal against the decision, so it might not be the last time we say goodbye to the Samsung Heir. It was alleged that these favours were created to win government support for a company restructuring and strengthen Lee's control over Samsung.

Samsung, founded in 1938 by Lee's grandfather, is a household name in South Korea and a symbol of the country's dramatic rise from poverty following the 1950-53 Korean War. Samsung's chairman has been found guilty of offering bribes and a number of other crimes, he has been accused of making rather large donations to foundations which are operated by Park Geun-hye.

It seems unlikely that Lee will get the same government favors as his father, Lee Kun-hee, Samsung's chairman, who was convicted two times of bribery and tax evasion but who served no jail time after being pardoned twice. Lee, the South Korea's third richest man, has apparently been convicted in a case of bribery and cronyism that has previously toppled the country's president, Park Geun-hye. Park was impeached back in May for her involvement.

The verdict sends the strongest message yet to South Korea's big, family-controlled businesses that their more than 60 years of economic dominance in one of the world's most successful economies is under threat. "They also embezzled money from Samsung Electronics, illegally transferred assets overseas and concealed criminal profits".

Samsung shares have risen by 30 percent so far in 2017. Nearly 60 companies affiliated with Samsung account for a third of South Korea's stock market capitalization.

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