November 22, 2024

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[THE INVESTOR] A special prosecutors’ team on Aug. 7 sought a 12-year jail term for Samsung Group Vice Chairman Lee Jae-yong on bribery and embezzlement charges.

The 49-year-old Samsung heir is suspected of offering a combined 43.3 billion won (US$38.40 million) to former President Park Geun-hye’s long-time confidante Choi Soon-sil in return for business favors. 

“This is a typical corruption case involving conglomerates and political powers that undermines the values of the constitution of our democracy and rights of the public,” a prosecutor said during the last hearing held in Seoul on the day.

Prosecutors also sought a 10-year prison term for Lee’s top aides Choi Gee-sung, former chief of Samsung’s control tower office Future Strategy Office, Chang Choong-ki, former director at the office, and Park Sang-jin, a former Samsung Electronics executive who served as chairman of the Korea Equestrian Federation, all facing trial for their alleged involvement. The prosecution also demanded a seven-year prison term for Hwang Seong-soo, another Samsung executive who served as vice chairman of the equestrian federation. 

Lee denied the allegations he had offered bribes to the former president through her confidante in hopes of returning favors.

“I never asked for some favors from the former president for my own interest,” said Lee during the hearing.

The Samsung heir also countered the prosecutors' argument that the contentious merger between Samsung C&T and Cheil Industries caused damage to the National Pension Fund, which used to be the largest shareholder of the C&T.

Choi is said to have forced NPS, overseen by the Ministry of Health and Welfare to cast its vote for the merger, an important step to solidify Lee’s control over the conglomerate, in a shareholder meeting despite opposition from some of C&T’s shareholders, including Elliott Management.

Since Lee was detained on Feb. 28, the court has summoned 59 people to testify in 53 hearing sessions at the highly publicized trial. The special counsel claimed that the Samsung heir played a key role in the nation’s largest conglomerate offering financial support to Choi and her dubious businesses. Part of the funds are believed to have financed Choi’s daughter Chung Yoo-ra, a former national equestrian athlete.

The counsel has alleged that the bribes for Choi were used to gain the backing of the Park administration for the ongoing power succession at the conglomerate from bedridden Samsung Chairman Lee Kun-hee to his son.

Prosecutors presented memos written by Park’s former senior secretary Ahn Jong-beom as evidence. According to transcripts of phone conversations between the former president and her aides seen in Ahn’s notebooks, Park said phrases like “holding firm for (Samsung’s) financial affiliates,“ “global finance,” and “the separation of industrial and financial capital,” which, the prosecution claimed as evidence that the government was trying to resolve Samsung’s cross-shareholding issue and increase Lee’s control over affiliates and subsidiaries. The court acknowledged the notes as circumstantial evidence.

The unexpected attendance of Choi’s daughter Chung Yoo-ra as a witness in one of the hearings, along with documents found in one of the cabinets in an office previously occupied by a former presidential secretary drew heightened attention. Taking the stand on July 12, Chung said Samsung must have been aware of the so-called ”horse-laundering,” referring to how Samsung had traded two of Chung’s horses with its own.

Former Samsung executives have also said that the firm “agreed” to support Choi fearing a political backlash.

The impeached former president, however, refused to attend any of the hearings. Choi appeared in court on July 26, but refused to testify.

By Kim Young-won (wone0102@heraldcorp.com)