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15 April 2024

S. Korea prosecutors to decide Monday on Samsung heir arrest


South Korean prosecutors investigating a major influence-peddling scandal involving impeached President Park Geun-Hye said they would decide Monday whether to arrest the heir to the giant Samsung group over alleged bribery.
Lee Jae-Yong, Samsung Electronics vice chairman and the son of the group's current chairman Lee Kun-Hee, is accused of approving a decision to pay Park's secret confidante Choi Soon-Sil large sums of money to secure favourable decisions.

The junior Lee was quizzed through Thursday and Friday as a criminal suspect, and three other senior Samsung executives were also questioned.

'We will reach a decision on Monday... on whether or not to arrest Lee by taking into account the complexity and the significance of the issue,' Lee Kyu-Chul, spokesman for a special team of prosecutors probing the scandal, said Sunday.

The prosecutors had planned to make the decision on Sunday but legal deliberations took longer than expected 'due to the significance of the move', Lee told a televised briefing.

The scandal centres on Choi, who is accused of using her close friendship to the president to coerce top Seoul firms into 'donating' nearly $70 million dollars to two non-profit foundations which Choi then allegedly used for personal gain.

Samsung— the biggest contributor to the foundations — is also accused of separately providing millions of euros to Choi to bankroll her daughter's equestrian training in Germany.

The Samsung group has dozens of units ranging from electronics to hotels. Its collective revenues are equivalent to around 20 percent of South Korea's annual economic output.

Flagship firm Samsung Electronics is the world's top smartphone maker.

Recent health problems concerning the senior Lee, currently bedridden after suffering a heart attack last year, prompted the group to step up restructuring efforts.

Prosecutors are probing whether Samsung's donations were aimed at securing approval for a controversial deal it sought in 2015.

The merger of two Samsung units — Cheil Industries and Samsung C&T — was seen as a key step towards ensuring a smooth third-generation power transfer to Lee Jae-Yong.

The deal was opposed by many investors who said it wilfully undervalued Samsung C&T's shares. But the National Pension Service — a major Samsung shareholder—approved the deal, which eventually went through.

A former welfare minister who at the time oversaw the operations of the pension fund has been arrested for allegedly pressuring the fund's managers to approve the merger.

Park is accused of colluding with Choi to extract money from local businesses and letting her meddle in a wide range of state affairs. She was impeached by parliament last month.

The Constitutional Court is currently reviewing the validity of the impeachment. If it upholds the decision, a fresh presidential election must be held within two months.