Lee paroled, showing power of Samsung in South Korea
SEOUL, South Korea (AP) – Samsung frontman Lee Jae-yong was released from prison on Friday a year earlier in a parole decision demonstrating the conglomerate’s outsized influence in South Korea as well as continued leniency for bosses who commit corporate bribery.
Dressed in a gray suit and mask, Lee left the prison near Seoul under a barrage of camera flashes and bowed to apologize for anger over his case, linked to the scandal of explosive corruption that toppled the former president of South Korea in 2017. Hundreds of protesters standing behind police lines simultaneously shouted slogans denouncing or hailing his release.
“(I) caused too much concern to our people. I’m so sorry, ”said Lee, who had spent the last few months in jail relaying his business decisions by visiting employees. He said he kept close attention to “huge concerns, criticisms and expectations” about him, then got into a black sedan without answering questions from reporters.
Lee, 53, is the third-generation heir to a business empire that runs everything from tech, construction and financial services companies to hospitals, an amusement park, and baseball and football clubs. The crown jewel, Samsung Electronics, alone accounts for around 20% of South Korea’s total stock market value and a quarter of its total exports.
Lee’s parole marked an about-face for the government of President Moon Jae-in, which, after being elected in 2017, pledged to curb the excesses of “chaebol”, or South Korean family conglomerates, and end their close ties with the government. Moon spokesman Park Soo-hyun said in a statement that Lee’s release was in the “national interest” and pleaded for people’s understanding.
Business leaders and key members of Moon’s government had approved Lee’s early release in recent months, citing Samsung’s vital role in South Korea’s export-driven economy and the growing challenges it faces on the global semiconductor market.
Releasing Lee became politically practical for Moon after recent polls indicated that the South Korean public – years of angry protests that filled the streets with millions of protesters in 2016 and 2017 – were broadly in favor of the release. by Lee. With the next presidential election slated for March 2022, the ruling liberals hope to win votes among the millions of South Koreans who own Samsung shares, some experts say.
Samsung made no immediate comment on Lee’s release.
Lee served a total of 18 months of a 30-month sentence for embezzling millions of dollars in corporate funds to bribe then-president Park Geun-hye to secure her government’s backing to a merger in 2015 between two subsidiaries of Samsung which strengthened its control over the company Empire.
Her case was part of a huge corruption scandal that sparked nationwide protests and led to the impeachment and ousting of Park, who has been in jail since 2017 and will not be released until 2039 if she serves. fully his sentence.
Even with his release, Lee did not come out of the legal woods. He appeared in Seoul Central District Court on Thursday for another trial for alleged stock price manipulation, audit violations and other financial crimes related to the 2015 merger. His attorneys insisted that the allegations in this matter were not criminal acts but were normal business activities.
By including Lee among the roughly 800 prisoners who were granted parole ahead of Sunday’s Liberation Day, which celebrates Korea’s independence from Japanese colonial rule at the end of World War II, the Justice Department cited unspecified economic concerns related to the pandemic and global markets.
Lee heads the Samsung conglomerate in his capacity as vice president of Samsung Electronics, a leading global supplier of computer memory chips and smartphones.
Lee was initially sentenced in 2017 to five years in prison for corruption, but was released after 11 months in February 2018 following a Seoul High Court ruling that reduced his sentence to 2.5 years and suspended. his sentence, overturning key convictions and reducing the amount of his bribes.
The Supreme Court returned the case to the High Court in 2019, ruling that the amount of Lee’s bribes had been undervalued. Lee was jailed again in January this year following a new trial.
Hardly anyone expected Lee to serve his full sentence until July 2022.
After avoiding the problem for months, Moon signaled a drastic change in May when he told reporters his government would examine both the increased competition in the semiconductor industry and public sentiment before. decide to grant Lee early release.
Moon’s office initially moved away from releasing Lee, saying releases were the responsibility of the Justice Department, before using his Friday statement to respond to criticism that he has rekindled a tradition of preferential treatment. for convicted tycoons.
While Lee has always controlled Samsung, whether in the boardroom or in a jail cell, it’s unclear how quickly he could officially resume his leadership role. He would need the Minister of Justice to formally approve his return to work, as the law prohibits those convicted of major financial crimes from returning to work for five years after their release. He is generally expected to obtain this approval.
Samsung showed no obvious signs of trouble while Lee was in jail. It posted solid profits during the coronavirus pandemic, seeing greater demand for its consumer electronics and chips used in computing devices and servers as the virus forced millions to stay at home.
But there were also opinions that Lee’s jail time compromised Samsung’s speed in major investments when it had to spend aggressively to stay competitive in semiconductors and other tech.
While Samsung remains dominant in memory chips, which are used to store information, it is apparently falling behind rival Taiwan Semiconductor Manufacturing Co. in the race for high-tech chips designed to run a wider range. of functions.
The demand for advanced chips is expected to grow rapidly in the coming years, driven by 5G wireless services, artificial intelligence and self-driving cars. Some analysts say Samsung will become more active in seeking M&A deals to acquire technologies such as Lee will be able to sign investments more easily.