Samsung Heir Jay Y. Lee Arrested on Bribery Allegations
Samsung Group’s Jay Y. Lee was formally arrested this morning on allegations of bribery, perjury and embezzlement, an extraordinary step that jeopardizes the executive’s ascent to the top role at the world’s biggest smartphone maker, according to Bloomberg.
Including procedural steps and appeals, it may take as long as 18 months for a trial and verdict. The decision was made because of the risk that he might destroy evidence or flee, a court spokesperson said.
Investigators are looking into whether the vice chairman of Samsung was involved in providing as much as 43 billion won ($38 million) to benefit a close friend of South Korean President Park Geun-hye, in exchange for government support of his management succession. Prosecutors allege that Lee funded Park’s associates as he tried to consolidate control over the conglomerate founded by his grandfather.
Lee, who had been waiting for the court’s decision at a detention center in Seoul, will remain there as a result of the arrest warrant. The court rejected the prosecutor’s request to arrest Samsung Electronics President Park Sang-Jin. With Lee under detention, Park will probably assume some of Lee’s responsibilities.
After the prosecutor’s first attempt to arrest Lee was rejected by a court on Jan. 19 due to lack of evidence, the billionaire heir was called in again for 15 hours of questioning as investigators sought more information. In their second attempt, a spokesman for the special prosecutor said that they found evidence of Lee concealing profit gained through criminal acts and hiding assets overseas.
Samsung has denied it made an unlawful offer or paid a bribe to the president in exchange for favors. The conglomerate’s transition to a new, younger leader was already marred by last year’s botched debut of the Note 7, a smartphone that was discontinued after it showed a tendency to catch fire and explode.
The Samsung probe is part of a broader investigation into contributions that dozens of Korean companies gave to Choi Soon-sil, a confidante of Park. The scandal has rocked South Korea with millions of people taking to the streets in protest. President Park has been impeached and her powers suspended.