Samsung Chief Goes Home After Lucky Break on Appeal

  • By Shin Su-ji

    February 06, 2018 12:01

    Samsung chief Lee Jae-yong was released from remand jail on Monday after the Seoul High Court reduced his five-year jail term for corruption to a suspended sentence.

    Lee looked solemn as he left the courtroom but flashed a smile as he emerged outside. He told reporters that the past year he spent in remand jail offered him "a chance to reflect on myself" and pledged to be more careful in the future.

    When asked when he intends to return to leading the conglomerate, Lee merely said he first has to visit his father, the nominal Samsung chairman, who has been in a coma since a heart attack in 2014. He met his sister and Hotel Shilla President Lee Boo-jin and his mother at Samsung Medical Center, where Lee senior is lying, before going home to Hanam-dong.

    The appeals court in a familiar scenario drastically whittled down Lee's convictions, clearing him of three out of seven charges, including several counts of bribing ex-President Park Geun-hye and her toxic confidante Choi Soon-sil to ease his backdoor succession to the conglomerate's leadership.

    It ruled that billions in payments to Choi's bogus Mir and K-Sports foundations and a winter sports training center run by Choi's niece were not straight-up bribes but the result of extortion by Park and Choi.

    Samsung chief Lee Jae-yong leaves a remand prison in Uiwang, Gyeonggi Province on Monday.

    The decision turned on a questionable ruling by the lower court. The original ruling said while the money was not an explicit bribe, it did result in Park pressuring the national pension fund, a major Samsung shareholder, to approve a merger of two Samsung subsidiaries. And this, thanks to the conglomerate's Byzantine holding structure, made Lee's succession to the leadership possible even though he holds only a small minority share.

    But the higher court ruled the causal chain is too long. "There was no pending issue of transferring management control at Samsung and there was no tacit request for favors" at the time Samsung paid the money, it said.

    "The merger of Samsung C&T and other decisions were necessary for management purposes and there is no evidence to infer a tacit request for favors." The court added Park "cannot be viewed as having acknowledged the transfer of management control, so the charge of 'tacit bribery' cannot be recognized."

    Out of the total bribery charges worth W43.3 billion, the only one Lee remains guilty of relates to the payment of W3.6 billion to Choi to finance her daughter's equestrian training in Germany. But the court took into consideration that Lee was pressured by Park and Choi to pay the money and did not offer the bribe voluntarily. It also cleared Lee of concealing criminal proceeds by doctoring the money trail and hiding assets overseas in relation to that payment.

    The independent counsel appointed to investigate the case said the donations were "a textbook case of the cozy relationship between politics and business." But the higher court ruled that there was no evidence that Samsung bribed politicians to pave the way for highly leveraged business expansion, as was the case in past high-profile scandals.

    That drastic feat of clearing the decks allowed the court to let Lee off with a two-year suspended sentence, taking into account that he has no prior criminal record.

    Samsung issued no official statement, but according to a senior executive, Lee faces another trial at the supreme court as prosecutors are set to appeal.

    The ruling divided Koreans. The Democratic Party and People's Party slammed it as biased in favor of the establishment, while Park's old Liberty Korea Party lauded the court for "rectifying an unreasonable investigation by prosecutors."

    Samsung accounts for some 15 percent of the entire Korean economy.

    • Copyright © Chosunilbo &
    Previous Next
    All Headlines Back to Top