Samsung heir denies all charges in ‘trial of the century’

[chahlley]

(World/business Today Friday 10 March 2017)

Samsung heir denies all  charges in ‘trial of the century’

Samsung Electronics vice-chairman Lee Jae-yong is the highest-profile business figure indicted

in a sprawling corruption investigation that has also led to President Park Geun-hye’s impeachment.

Photo: AP

SEOUL — Samsung Electronics vicechairman Lee Jae-yong has denied all charges against him in connection with the alleged influence peddling and bribery scandal that is poised to topple South Korean President Park Geun-hye.

At yesterday’s opening of the hearing against Mr Lee, his lawyers denied the charges, which include bribery and embezzlement, reported the Financial Times. Mr Lee, the 48-year-old head of the South Korean conglomerate’s electronics business, was not present at the preparatory hearing.

Mr Lee is the highest-profile business figure indicted in a sprawling corruption investigation that has  also led to Ms Park’s impeachment and spurred outrage over “chronic corruption” in ties between government and family-run conglomerates. Special prosecutor Park Young-soo has called the legal contest surrounding Mr Lee South Korea’s “trial of the century”, given his global profile and the amounts of money involved.

Hearings at the Seoul Central District Court are set to last up to three months. The biggest point of contention will be whether Samsung’s  donations to entities led by Ms Park’s friend Choi Soon-sil were intended to win government backing for a controversial 2015 merger that made it easier for Mr Lee to control the Samsung Group chaebol.

Mr Lee was indicted last month along with four other Samsung executives, but he was the only one to
have been detained. The prosecutor accuses him of conspiring to transfer 29.8 billion won (S$36.5 million) to  Ms Choi’s organisations in return for favours. These allegedly included currying support from the governmentbacked National Pension Service for a 2015 merger of Cheil Industries and Samsung C&T Corp. Other charges against Mr Lee include hiding assets overseas, perjury and hiding criminal profits.

“Proving there was an exchange of money for favours is going to be challenging,” said Mr Hong Jung-seok, a lawyer who worked for the special prosecution until the end of last month. “The trial will draw attention from around the world, not just for the defendant’s fame abroad, but  also for the size of the alleged bribe.”

The preliminary hearing yesterday lasted about an hour, with  Mr Lee’s lawyers and prosecutors appearing before presiding judge Lee Yeong-hun. Mr Lee’s lawyers tried to show a PowerPoint presentation, but prosecutors objected, saying the hearing was supposed to cover only the basics of the trial and the judge agreed. Defence lawyers then disputed the legitimacy of their opponents because the special prosecutor was helped during the hearing by regular state prosecutors.

These are strange days in Seoul, with some of the country’s most powerful figures under scrutiny several kilometres apart. A constitutional court will decide today whether to  uphold Ms Park’s impeachment and remove her from office, a ruling  almost certain to provoke protests whatever the outcome. The scandal has already engulfed the streets of South Korea’s capital for months, as protests spring up regularly under the watch of police in riot gear.

Mr Lee faces five years to life in prison, if convicted. Under South Korea’s three-tier judiciary system, he can turn to an appellate court and then the Supreme Court if he loses, with each court taking up to two months to deliberate. His father avoided jail time despite two previous criminal convictions, thanks to government pardons.

Mr Lee’s predicament casts uncertainty over the succession at Samsung, which has been in transition since his father suffered a crippling heart attack in 2014. The prolonged absence of its de facto head may delay major decisions at Samsung Electronics, which is set to unveil the latest version of its flagship smartphone, the Galaxy S8, this month. Still, Samsung has said it has a strong management team in place to run the business, and the company’s shares have risen  11.5 per cent this year, more than three times the gain in the benchmark Kospi index. AGENCIES

Mr Hong Jung-seok: lawyer who worked for the special  prosecution until the end of last month.

The trial will draw attention from around the world, not just for the defendant’s fame abroad, but also for the size of the alleged bribe.