Samsung's Lee Jae-yong faces prosecution again a year after getting pardoned
Earlier today, the state prosecution demanded a five-year jail term for Samsung boss Lee Jae-yong in connection to the controversial merger of Cheil Industries and Samsung C&T. Lee was apparently involved in stock price manipulation and accounting fraud. He is also charged with breach of duty during the merger. Back in 2015, three shares of Samsung C&T were offered for one share of Cheil Industries, and the merger of these companies allowed Lee Jae-yong to have a 23.2% share in Cheil Industries. This, in turn, offered him a tighter grip over Samsung Electronics, the pioneer brand under the Samsung Group.
After Lee Kun-hee (Lee Jae-yong's father and then chairman of Samsung Electronics) fell ill due to a heart attack, the merger of Cheil Industries and Samsung C&T offered Lee Jae-yong a tighter grip and chairmanship claim for Samsung Electronics. Prosecutors claim that the devaluation of Samsung C&T shares resulted in the loss of other shareholders, and Lee was behind stock price manipulation. Lee is also suspected of accounting fraud in Samsung BioLogics, a subsidiary of Cheil Industries. The prosecutor claimed that Lee was in a position of power and the ultimate benefactor of this deal.
It is reported that the prosecution has also demanded a fine of KRW 500 million ($384,000) and a jail sentence of 4.5 years from two other people, including Choi Gee-sung, who was the head of the Future Strategy Office, which is now disbanded. A ruling in this case is expected to arrive in early 2024.
