Samsung leader cleared of fraud charges

Samsung CEO Jay Y. Lee was звільнений from criminal charges by South Korea's second-highest court, Bloomberg reports. Earlier on Monday, the Seoul High Court upheld a preliminary ruling to drop Lee's charges of stock manipulation and accounting fraud in a 2015 merger. The ruling will allow Lee to focus on his mobile and chip businesses Samsung, whose profits have declined in the past few years. Yee has consistently denied any wrongdoing.

The prosecution can still appeal to the Supreme Court of Korea, but that is unlikely to succeed because new arguments cannot be presented, experts say. “The investigation and trial of this case have taken a very long time,” Samsung lawyer Kim Yoo-jin said in a statement. “We hope that with this verdict, the defendants will be able to focus on their work.”

Back in 2017, prosecutors accused Lee of manipulating the share prices of two Samsung subsidiaries to smooth the way for a merger that would allow him to consolidate his power. However, in early 2024, a court ruled that prosecutors had failed to prove this. “It is difficult to say that Lee Jae-yong [aka Jay Y. Lee]… was the initiator of the merger, and that the merger was done solely for the sake of Lee’s succession,” the judge said in his ruling.

The decision was welcomed by business groups at the time, but not everyone in the country agreed with it. “The decision will relieve Lee of legal risks, but I am at a loss for words in terms of the country’s economic justice,” Park Ju-gun, chairman of the corporate think tank Leaders Index, told The Financial Times in February 2024. “It completely contradicts all previous court rulings on mergers.”

Lee was initially sentenced to five years in prison in 2017 after being found guilty of bribery of public officials in connection with the same merger, but the Supreme Court overturned the decision and ordered a retrial. In early 2021, Lee was sentenced to two and a half years in prison, and was paroled six months later (former Korean President Park Geun-hye was also imprisoned for her role in the same case). In 2022, Lee was pardoned by South Korean President Yun Seok-yeol, who himself had recently been impeached and charged with sedition for attempting to impose martial law.