Samsung Corruption Scandal

The special prosecutor of South Korea sought the arrest warrant of the Samsung Group chief Jay Y. Lee for bribery. He has been accused of paying multi-million dollar bribes to Ms. Choi who is a friend of President Park Geun-Hye.

As we reported earlier, many top executives were called into questioning last year as the company finds itself amid a financial scandal. Samsung is suspected of funneling $3.1million into German company owned by Soon-Sil which pays for her daughter’s riding lessons.

Samsung Group Chief Jay Y. Lee
Samsung Group Chief, Jay Y. Lee

The prosecutors also raided National Pension Service (NPS) last November while investigating the NPS’s decision of approving the $8 billion merger of Samsung C&T and Cheil Industries in 2015. This merger has been scandalized since its inception firstly when nine Samsung executives from various affiliates were under investigation for insider trading. Secondly, the circumstances of NPS’s approval of the said merger have been termed mysterious as its backing was a decisive element in the success of the agreement.

Last week the investigators grilled Jay Y. Lee for 22 straight hours as a suspect in the corruption scandal. He is accused of paying total bribes of 43 billion won ($36.42 million) to different organizations that are linked to Choi Soon-Sil to secure the merger with Cheil Industries.

Special prosecution spokesman Lee Kyu-Chul in a media briefing said:

“The special prosecutors’ office, in making this decision to seek an arrest warrant, determined that while the country’s economic conditions are important, upholding justice takes precedence.”

Samsung has rejected the accusations made by the special prosecutor and has expressed that it is difficult to understand the special prosecutors’ decision. The company generates $230 billion in revenue which is approximately equal to 17pc of South Korea’s economy.

The company was hit hard last year with the whole exploding Note 7 scandal, and the arrest of the Samsung Group chief is bound to hamper its progress. He is due to appear at the Seoul Central District Court on Wednesday where it will be decided whether the arrest warrant would be granted or not.


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