13 Apr 2017

Heir to Samsung in bribery scandal

heir to the multi billion company Samsung Group’s Jay Y. Lee is fighting alledging that he had bribed a confidante of former South Korean president Park Geun-hye and conspired to cover it up, embroiling him in a scandal that’s seen her thrown out of office. He is under pressure of corruption and as well as destruction of evidence. The heir to South Korea’s largest corporation turned up in court Friday for the first time since his detention, in a corruption trial that marked a stunning turn for the only son of South Korea’s richest family — and a man groomed to take over the company. The billionaire is accused of paying bribes to get the support of a government pension fund in a controversial 2015 merger of affiliates that tightened his grip. Investors however have shrugged off the scandal, counting on share buybacks, steady growth from its memory and display divisions and a new premium smartphone. Its stock is up 16 percent this year through Thursday. Below is a chronological order of happenings that brought Samsung into the center of one of south Korea’s biggest corruption scandals. Feb. 25, 2013: Park Geun-hye, daughter of former dictator Park Chung-hee, inaugurated as South Korea’s first female president for a five-year term. Park Geun-Hye salutes during her inauguration ceremony on Feb. 25, 2013.Photographer: Park Jin-Hee/Pool via Getty Images May 10, 2014: Lee Kun-hee, chairman of Samsung Group, suffers heart attack, throwing the spotlight of succession on Jay Y. May 26, 2015: Cheil Industries Inc. agrees to buy all of Samsung C&T Corp. in a stock deal then valued at about $9.3 billion. June 4, 2015: Paul Elliott Singer, the activist investor, announces intention to take a role in management of Samsung C&T after purchasing a stake. Elliott Associates LP later unsuccessfully seeks injunction to stop deal with Cheil, arguing it undervalues C&T. July 17, 2015: Samsung C&T investors approve Cheil deal with 69.5 percent of votes in favor, just above the two-thirds majority needed. Korea’s government-backed National Pension Service, the biggest shareholder in C&T with about 10 percent of shares, supports the deal. July 24, 2015: Park hosts a meeting with some of South Korea’s largest corporations and asks the executives to support cultural projects and government-sponsored “creative economy” business centers. Oct. 27, 2015: Mir Foundation is formed. Its website says the foundation was established by “16 large, like-minded Korean companies” to promote cultural diplomacy and “elevate Korea’s national stature.” Jan. 18, 2016: K-Sports Foundation is formed. Its website says its efforts include identifying, nurturing and supporting Korean athletes. July 27, 2016: Local broadcaster TV Chosun reports An Chong-bum, then a presidential secretary, was involved in launching Mir Foundation and collecting about 50 billion won (about $44 million) in donations from corporations. Sept. 20, 2016: The Hankyoreh newspaper reports Choi Soon-sil, a longtime confidante of Park, may be behind the K-Sports Foundation. Oct. 26, 2016: Yonhap News reports prosecutors raid Mir and K-Sports foundations, which raised more than $70 million from conglomerates including Samsung with the help of the business lobby group, the Federation of Korean Industries. Part of that money may have been used to buy a horse for Choi’s daughter, prosecutors said later. Read more on the nature of the bribery allegations surrounding Samsung. Oct. 25, 2016: President Park issues an apology in a nationally televised address, a day after a local TV station reported that it found presidential speeches on a tablet computer that was thrown away in Choi’s office. The documents include a 2014 speech in Germany outlining steps for an eventual reunification with North Korea. Oct. 27, 2016: Lee joins the nine-person board at Samsung Electronics Co., cementing his influence over the nation’s most powerful conglomerate. Nov. 3, 2016: Court approves arrest of Choi, who had returned days earlier from Germany to face questioning by prosecutors. Nov. 8, 2016: Investigators raid Samsung Electronics’ headquarters, seeking evidence on whether the world’s largest smartphone maker illegally provided gifts to Choi. Dec. 6, 2016: Heads of nine conglomerates, including Lee and Hyundai Motor Chairman Chung Mong-koo, are summoned to a parliamentary hearing on the influence-peddling scandal. Dec. 9, 2016: South Korea’s parliament votes to impeach Park. Dec. 21, 2016: A team led by special prosecutor Park Young-soo launches its own investigation. Dec. 28, 2016: Special prosecutors arrest the former chairman of the pension service, Moon Hyung-pyo, who acknowledges he pressured NPS officials into supporting the 2015 merger. Jan. 9, 2017: Samsung executives, including Corporate Strategy Office Vice Chairman Choi Gee-sung and President Chang Choong-ki, called in for questioning. Jan. 12 , 2017: Lee, named a suspect in a bribery investigation, is questioned for 22 hours. Jan. 16, 2017: Special prosecutor seeks a warrant to arrest Lee on allegations of bribery and embezzlement. Lee is accused of involvement in bribes of up to 43 billion won that Samsung made to Park’s confidante in exchange for government support in succession planning. Jan 19, 2017: Court rejects warrant request for Lee, saying the argument by prosecutors wasn’t strong enough. Feb. 14, 2017: Special prosecutor makes new request to arrest Lee, presenting new allegations of hiding assets overseas and concealing criminal profits. Feb. 17, 2017: Seoul Central District Court issues arrest warrant for Lee, who is locked up at a jail south of the capital. Feb. 28, 2017: Lee is formally indicted on five charges: embezzlement, bribery, hiding assets overseas, perjury and concealing profit from criminal activities. March 9, 2017: Lee’s trial begins, with the billionaire denying all charges. March 10, 2017: Constitutional court affirms parliament’s decision to impeach Park, removing her from office and nullifying her presidential immunity to prosecution. April 7, 2017: Samsung reports its best operating profit in almost four years; Lee appears in court for the first time to answer charges. It is unclear at this juncture what the outcome of the on going trial would be however whatever it comes to, it would be if great interest what becomes of the heir and only son of south Korea's richest family.

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