SEOUL (Reuters) – A South Korean court has sentenced Samsung Electronics Vice President Jay Y. Lee to two-and-a-half years in prison, the court said Monday, which will have major ramifications for its technology giant’s leadership. such as Korea’s views on big business.
With that, Lee will be sidelined for the time being from making important decisions at Samsung Electronics as he strives to outperform competitors. Nor will he be able to oversee the process of inheriting his father, who died in October, crucial to maintaining control of Samsung.
Lee, 52, was convicted of bribing a partner of former President Park Geun-hye and jailed for five years in 2017. He denied the wrongdoing, reduced his sentence and was suspended on appeal and was released after serving a year.
The Supreme Court then sent the case to the Seoul High Court, which ruled on Monday.
Seoul High Court found Lee guilty of bribery, embezzlement and concealment of criminal proceeds worth about 8.6 billion won ($ 7.8 million), and said the independent compliance committee that Samsung set up in early last year has not yet become fully effective.
“(Lee) has shown his willingness to administer with more recent compliance as he promised to create a transparent company,” said Chief Justice Jeong Jun-yeong.
“Despite some shortcomings … I hope that over time, it will be assessed as a milestone in the history of Korean companies as the beginning of compliance ethics for a greater leap forward,” he said.
Lee, dressed in a dark coat and a silver tie and standing to hear the sentence, sat down after reading.
“The nature of this case is the former president’s abuse of power that violates corporate freedom and property rights. Given this nature, the court’s decision is unfortunate,” Lee’s lawyer told reporters. Lee In-jae.
When Lee returns to prison, the year in which he already served his arrest is expected to count for the sentence, leaving him to serve 18 months of his sentence.
Monday’s ruling can be appealed to the Supreme Court within seven days, the judge said, but legal experts said that since the Supreme Court has already ruled once, it is more likely to change its interpretation. legal.
Shares of Samsung Electronics fell to 4% after the ruling, while shares of subsidiaries such as Samsung C&T, Samsung Life Insurance and Samsung SDI also fell sharply.
Report by Joyce Lee; additional reports from Choonsik Yoo. Edited by Gerry Doyle