Korean prosecutors charge Samsung head, other execs with bribery & embezzlement

Posted:
in General Discussion
South Korea prosecutors on Tuesday indicted the acting head of the Samsung Group -- Jay Y. Lee -- for bribery and embezzlement, leveling similar charges at four other executives as well in the influence scandal surrounding Korean President Park Geun-hye and her friend, Choi Soon-sil.




Lee, who was arrested on Feb. 17, is specifically accused of promising $38 in million in bribes to a company and various organizations tied to Choi in order to secure a merger between two Samsung affiliates, Reuters noted. Parliament voted to impeach Park in December, and next month the country's Constitutional Court is expected to rule on whether to uphold that and force her from office.

Park, Choi, Lee, and the Samsung Group have all denied any wrongdoing. Lee could potentially face up to 20 years in prison, but one factor that might aid his position is that Park's impeachment was based on accusations that she and Choi pressured businesses -- including Samsung -- to donate to foundations set up to support her policies.

On Tuesday Samsung also announced the dismantling of its corporate strategy office, staffed by about 200 workers from various Samsung affiliates. The informal unit was responsible for plans like new business investments, but is also said to have been a tool wielded by the founding Lee family, and politicians have accused it of being tied to illegal lobbying.

Going forward, the CEOs and boards of affiliates -- including Apple rival Samsung Electronics -- will be able to steer their own companies, Samsung said. The company is also separating itself from the Korean Equestrian Federation, since the bribery charges include sponsorshop of the equestrian career of Choi's daughter.

A special prosecutor's office that has so far been handling the case against Park is set to hand over the case to regular prosecutors in the near future, delivering its final report on March 6. It's not known, however, when Lee and other Samsung executives will face trial.

One of the indicted executives includes Samsung Electronics President Park Sang-jin, but it's not certain to what extent that might affect the division's long-term plans. It's already planning to reveal the Galaxy S8 and S8+ on March 29, and other devices like the Note 8 are well into development.

Havoc at Samsung could theoretically aid Apple, but the latter depends on Samsung as a supplier. Indeed the upcoming "iPhone 8" is expected to use a 5.8-inch OLED panel from the Korean company. Only 5.1 inches will likely be practical though, the rest of it being dedicated to virtual buttons replacing the physical home button that's been on iPhones since 2007.

Comments

  • Reply 1 of 11
    Yay!
    Just call them 'political contributions', and then it's completely acceptable!
    jbdragonmaciekskontaktlostkiwitallest skilwatto_cobra
  • Reply 2 of 11
    jkichlinejkichline Posts: 1,319member
    Looks like it's not just their smartphones that are blowing up.
    jbdragonpscooter63lostkiwimagman1979lollivertallest skilwatto_cobracali
  • Reply 3 of 11
    jkichlinejkichline Posts: 1,319member
    brakken said:
    Yay!
    Just call them 'political contributions', and then it's completely acceptable!
    Yeah, no kidding. That crap in the U.S. has got to stop.
    lostkiwi
  • Reply 4 of 11
    Rayz2016Rayz2016 Posts: 4,556member
    I did not see this coming. 

    Having said that, he hasn't been convicted yet. 
    lostkiwicornchipwatto_cobra
  • Reply 5 of 11
    maestro64maestro64 Posts: 4,422member
    The market should hammer their stock, but it does not. Any US company with an sort of scandal like this would kill it stock. But no they turn a blind eye to what Samsung does so they will keep doing what they always have done.
    lostkiwicornchipwatto_cobra
  • Reply 6 of 11
    jbdragonjbdragon Posts: 1,966member
    I'm still surprised it's gone this far. Why hasn't it all be wiped under the rug already. Samesung and the Government are one and the same for the most part. Who did this person really piss off?
    firelocklostkiwicornchipwatto_cobra
  • Reply 7 of 11
    jkichline said:
    brakken said:
    Yay!
    Just call them 'political contributions', and then it's completely acceptable!
    Yeah, no kidding. That crap in the U.S. has got to stop.
    That was not legal in some US industries (fianace). It is just as easy as extend that policy to all publically traded companies and problem fixed... except that some banks seem to pay excessively large sums for speeches avoiding term "donation".
    lostkiwi
  • Reply 8 of 11
    SleepydocSleepydoc Posts: 6unconfirmed, member
    jbdragon said:
    I'm still surprised it's gone this far. Why hasn't it all be wiped under the rug already. Samesung and the Government are one and the same for the most part. Who did this person really piss off?
    Ditto - from my limited understanding of Korean government & culture this is a *huge* deal. I was surprised enough that he was investigated and arrested, much less charged. Not sure it this is an indication of shifting attitudes in Korea or just that what he did was so bad it couldn't be ignored. Or perhaps that he was unlucky enough to be associated with a hugely unpopular president.
    lostkiwicornchipwatto_cobra
  • Reply 9 of 11
    jbdragon said:
    I'm still surprised it's gone this far. Why hasn't it all be wiped under the rug already. Samesung and the Government are one and the same for the most part. Who did this person really piss off?
    I maintain that there has likely been a power struggle going on inside Samsung ever since the founder stepped down.
  • Reply 10 of 11
    Oh well what can you do.....
  • Reply 11 of 11
    subbies said:
    Oh well what can you do.....
    Toast!
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