On Friday, Samsung de-facto chief, Jay Y. Lee, has been sentenced to five years of imprisonment for bribery. Lee was prosecuted for playing a role in a scandal that earlier called for impeachment of Park Guen-hye, the former South Korean president.
Lee and Park built a relationship of bribe and take favor that lead to a turning point in the country’s economic order running for decades. Lee was found guilty by court for hoarding assets abroad and of being involved in fraud and perjury.
Lee was held by court since February on the charges that he has bribed Park with more than $14 million to help him expand his power and control over another corporation that is world’s top smartphone and chip-maker. Moreover, Lee’s interests for bribing ranged from drugs to insurance.
Jay Y. Lee, 49 years old successor to world’s top-ranking empire, got sentenced to jail for 5 year, which is the longest ever verdict given to any business leader of South Korea. The verdict has alerted leaders from South Korea who are involved in running inherited conglomerate.
Kim Jin-dog, judge at Central District Court, asserted that Lee was to benefit the most from bribing the president and getting political favors for his family-run Samsung Corporation. Kim said, “This case is a matter of Lee Jae-yong and Samsung Group executives, who had been steadily preparing for Lee’s succession … bribing the president.”
Surprisingly, Lee has denied is wrongdoings and his lawyer, Song Wu-cheol, is determined to appeal in Supreme Court to appeal for the innocence of his client. Supreme Court trial is expected to begin next year.
How the Jay Y. Lee verdict Affect South Korea?
South Korean corporations have worked diligently to bring out their country from poverty and economic crisis that followed 1950-53 War.
Samsung signifies rise of country from abject post-war poverty and the economy rise epitomized bild-up of corrupt ties between politicians and family-run conglomerates (chaebols).
Chang Sea-Jin, who is a professor at Korea Advanced Institute of Science and Technology, found hope in the ruling for revolutionizing business ways of chaebols. She said, “In the past, chaebols weren’t afraid of laws because they were lenient. Now, Lee’s ruling sets a precedent for strict enforcement of laws, and chaebols should be wary.”
Joyce Lee, reuters Samsung correspondent, ‘This is key turning point in country’s economy because in the past, chaebol leaders were not prosecuted when they had committed crime…this ruling suggests that they will not go off-scot anymore”
South Korean law states that sentence of over three years cannot be suspended.
South Korean repute with respect to chaebols has been affected to a great extent. Moreover, chaebol leaders are expected to follow the laws in all their business deals as the 5 year jail sentence as shown them the consequences they may have to bear.
Reuters report revealed that many business tycoons, that include Lee’s father, previously were convicted with bribery, tax evasion and embezzlement charges. However, they got evicted via political pardon as the country feared the consequences their economy will have to bear.
Moon Jae-in, the newly elected South Korean president, has put an end to previous practices of pardoning business tycoons for bribery and corruption.