Samsung’s heir apparent Jay Y. Lee to be indicted on bribery charges
Seoul: South Korea’s special prosecutor plans to indict Jay Y. Lee, the de facto head of Samsung group, on bribery allegations along with four other executives, dealing a blow to the country’s largest conglomerate as it prepares for a generational handover.
Formal charges would mean Lee will stand trial over accusations of involvement in bribes for government favours. The Samsung Electronics Co. vice chairman is accused of directing tens of millions of dollars to entities controlled by a confidante of President Park Geun-hye, in return for government support of a 2015 merger that cemented his control of the group.
The planned indictment comes less than two weeks after a South Korean court approved an arrest warrant requested by the prosecutor, whose first attempt to put Lee in jail failed. Although a typical trial and verdict could take up to 18 months, the special-prosecutor law recommends resolving the case much sooner.
After any indictment, Lee can seek bail and the court must make its first ruling within three months.
Samsung has denied allegations it made an unlawful offer or paid a bribe to the president or Park-confidante Choi Soon-sil in return for political favours, including support for the merger of Cheil Industries Inc. and Samsung C&T Corp. That deal solidified Lee’s control over Samsung Group, paving the way for him to take the helm from his ailing father.
A trial of Lee means a carefully planned succession following his father’s 2014 hospitalization due to a heart attack could be delayed or even derailed. The conglomerate’s transition to a new, younger leader has already been marred by last year’s botched debut of the Note 7, a smartphone that was entirely pulled from store shelves because of a tendency to burst into flame.
The special prosecutor alleges Samsung made payments to gain the backing of the government-run National Pension Service, the world’s third largest pension fund with significant stakes in Samsung Electronics and listed affiliates. That deal was opposed by activist investor Paul Elliott Singer.
Among the other executives that will be indicted are Corporate Strategy Office vice chairman Choi Gee-sung and President Chang Choong-ki, the special prosecutor said. Bloomberg