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New Arrest Warrant Issued for Samsung Leader
June 07, 2020
South Korean prosecutors said have filed an arrest warrant for Samsung Group’s anointed heir Jay Y. Lee and two other former company executives as part of a sprawling investigation into an alleged accounting fraud and a controversial merger that shook the country. In May, Lee appeared before prosecutors to be questioned over the merger of two Samsung units. Prosecutors suspected that the value of Cheil Industries, an electronics materials provider, was intentionally inflated before its 2015 merger with Samsung C&T, Samsung Group’s de facto holdings company, to achieve a favorable rate for the heir, who was at the time the biggest shareholder in Cheil Industries. Critics argued that the merger made Lee the largest shareholder of Samsung’s de-facto holding company and smoothed the way for his succession from his ailing father. Prosecutors also believed that Lee had bribed former President Park Geun-hye to secure government support for the 2015 merger of the two affiliate companies. The scandal eventually led to Park’s impeachment in 2017 and her sentencing to a 25-year prison term over bribery, abuse of power and embezzlement charges. Lee has previously denied charges.
Figure 1: Samsung’s Jay Y. Lee
June 07, 2020
South Korean prosecutors said have filed an arrest warrant for Samsung Group’s anointed heir Jay Y. Lee and two other former company executives as part of a sprawling investigation into an alleged accounting fraud and a controversial merger that shook the country. In May, Lee appeared before prosecutors to be questioned over the merger of two Samsung units. Prosecutors suspected that the value of Cheil Industries, an electronics materials provider, was intentionally inflated before its 2015 merger with Samsung C&T, Samsung Group’s de facto holdings company, to achieve a favorable rate for the heir, who was at the time the biggest shareholder in Cheil Industries. Critics argued that the merger made Lee the largest shareholder of Samsung’s de-facto holding company and smoothed the way for his succession from his ailing father. Prosecutors also believed that Lee had bribed former President Park Geun-hye to secure government support for the 2015 merger of the two affiliate companies. The scandal eventually led to Park’s impeachment in 2017 and her sentencing to a 25-year prison term over bribery, abuse of power and embezzlement charges. Lee has previously denied charges.
Figure 1: Samsung’s Jay Y. Lee
Photo by Chung Sung-Jun/Getty Images