August 28, 2017 09:41
Samsung chief Lee Jae-yong is appealing his five-year prison term for bribery.
The Seoul Central District Court on Friday found Lee guilty of bribery, embezzlement, smuggling funds out of Korea, hiding illicit assets and perjury. The verdict is expected to have a profound impact on the trial of ex-President Park Geun-hye and her confidante Choi Soon-sil, who are accused of soliciting the bribes from Samsung.
The court said Park "was aware that the succession of management control to Lee was a major issue at Samsung and demanded funding for [Choi's daughter] Chung Yoo-ra and a youth winter sports foundation in a private meeting."
The court accepted that Samsung paid W21.3 billion in support for Chung's equestrian training, W20 billion in donations to the dodgy Mir and K-Sports foundations established by Choi, and W1.6 billion in support funding for the foundation, which was run by Choi's niece (US$1=W1,128).
It ruled that around W7.29 billion Samsung gave Choi and W1.62 billion in support for the winter sports foundation were straight-up bribes. "Samsung knew that Choi was behind the demands and appears to have known that financial support for Chung Yoo-ra was tantamount to helping Choi and constituted bribing the president," the court added.
Lee "is deemed to have implicitly sought an illicit favor" from Park in expediting a controversial merger of two Samsung subsidiaries, which thanks to the conglomerate's Byzantine holding structure gave Lee effective control despite holding only a small minority share.
The National Pension Service, which owns a chunk of Samsung, had the casting vote at the time. The court ruled that tapping into the publicly traded company’s funds to raise the W8 billion constituted embezzlement, and W3.7 billion of that money was illegally transferred to Germany, where Chung was living.
A hasty attempt to trade Chung's horse for another to hide the paper trail when the scandal unraveled in autumn last year was ruled as aiding Choi's attempts to conceal criminal proceeds.
The perjury conviction relates to Lee's sworn testimony to a National Assembly hearing last year, where Lee denied any knowledge of the bribes.
Samsung made no comments on the sentence, but Lee's lawyers said they are appealing. Lee's attorney Song Woo-chul said, "I cannot accept the ruling either from a legal standpoint or in consideration of the facts and will appeal immediately."
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