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HomeWorldSamsung billionaire heir sentenced to prison over bribery charges

Samsung billionaire heir sentenced to prison over bribery charges

Jay Y. Lee served a year in prison but was released in Feb 2018 after his original 5-year term was halved and suspended. The SC overturned that verdict & ordered a retrial in 2019.

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Seoul: Samsung Electronics Co. heir Jay Y. Lee was sentenced to two years and six months in prison over bribery charges, concluding a years-long graft trial that inflamed outrage over the cozy relationships between government and business.

Monday’s sentencing lands the top decision maker at the world’s biggest electronics company behind bars at a time of unprecedented global uncertainty. The Seoul High Court first jailed Lee in 2017 after convicting the billionaire for his role in a corruption scandal that toppled former president Park Geun-hye. The Samsung Group’s de facto leader served a year in prison but was released in February 2018 after his original five-year term was halved and suspended. The Supreme Court overturned that verdict and ordered a retrial in 2019.

Lee, 52, has been embroiled in a legal fight that started four years ago and stemmed from a controversial merger in 2015. The Samsung executive was accused of offering horses and other payments to a friend of the former president to win support for his formal succession at the corporation. The Supreme Court upheld a 20-year prison term for Park last week, citing wide-ranging charges including bribery related to Samsung.

Shares of Samsung Electronics fell nearly 4% after the sentence was read out loud.

The ruling creates a vacuum atop the world’s largest producer of memory chips, smartphones and consumer appliances at a time the Covid-19 pandemic is exacerbating rising uncertainty around the U.S.-Chinese relationship and intensifying competition. While Samsung’s daily business is run by an army of managers, Lee’s absence may stall or complicate massive investments or strategic longer-term moves. The executive plays an active role at the company, frequently joining government-related and public events after he was released from the prison.

During the last hearing on Dec. 30, Lee read out a lengthy personal apology over the case — reiterating pledges he first made in May — stressing his effort to make Samsung company great while pledging not to repeat past wrongdoings, and pledging not to pass down power to his children. Lee’s ascension to the chairmanship of Samsung after his father’s death in October is likely to be delayed until he goes free.

Separately, he faces another case related to a controversial merger between Samsung C&T and Cheil Industries in 2015, centered on allegations ranging from violation of capital markets law to a breach of duty. Lee will have to attend hearings in that case from jail. –Bloomberg

Also read: Lee Kun-hee, Korean icon who transformed Samsung into global powerhouse, dies at 78


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