Samsung boss bribed South Korean president, prosecutor says

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Chung Sung-Jun, Getty Images

Samsung’s de facto leader Jay Y. Lee is guilty of bribery, embezzlement and perjury, according to special prosecutor Park Young-soo.

The prosecutor laid down his case against the Samsung boss on Monday at a press conference, just days before Lee’s bribery trial is expected to begin.

“Samsung Group vice chairman Lee Jae-yong colluded with others including the corporate strategy office chief Choi Gee-sung to bribe the president and Choi Soon-sil with an aim to receive support for his succession by embezzling corporate funds,” special prosecutor Park Young-soo said, reports Reuters.

Lee, Samsung Group’s 48-year-old vice chairman, was last week formally charged with bribery in connection with a political-corruption scandal in South Korea, which saw the impeachment of South Korean President Park Geun-hye.

At issue is whether millions in donations Samsung made to two foundations controlled by President Park’s friend and confidant, Choi Soon-sil, were bribes to get the South Korean pension fund to back a merger between two of Samsung Group’s holding companies. The merger strengthened the Lee family’s control over Samsung.

Samsung has said it made the payments to Choi’s foundations but denied they were made in exchange for political favors. Choi has denied taking any part in the merger, while Lee has testified that he didn’t play a role in Samsung’s decision to make $17 million in donations to Choi.

Special Prosecutor Park said Lee committed perjury when he claimed to have not taken part in Samsung’s donations to Choi, according to Bloomberg. Samsung executives also created fake contracts to create a facade around bribes, prosecutors said.

Samsung Group maintains Lee’s innocence, however. “We disagree with the Special Prosecutor’s findings,” a spokesperson said in a statement. “Samsung has not paid bribes nor made improper requests seeking favours. Future court proceedings will reveal the truth.”

Lee has been slated to take over the company since his father Kun-Hee Lee was hospitalised in 2014 following a heart attack. The move by the South Korean court to indict Lee raises questions about his future at the company.

Samsung said last month that it would strengthen its rules on financial donations to increase transparency in the wake of Lee’s arrest. The company said it would now require financial donations and funding for corporate social responsibility of 1 billion won ($884,000) or more to be approved by the board of directors. Previously, only payments representing 0.5 percent of shareholder equity — 680 billion won or more — required board approval.

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