4 things about the Samsung Group bribery case

Samsung heir Lee Jae-yong was found guilty in August 2017 on charges including bribery and embezzlement and received a five-year jail term.
Samsung heir Lee Jae-yong was found guilty in August 2017 on charges including bribery and embezzlement and received a five-year jail term.PHOTO: AFP

SEOUL (REUTERS) - Samsung Group will discover the fate of its de facto leader on Thursday (Aug 29) as South Korea's Supreme Court rules whether to uphold the bribery conviction of Lee Jae-yong, in a scandal that unseated South Korea's former president Park Geun-hye and trained public ire on corporate untouchables.

Here are four things about the case.

1. HOW IS SAMSUNG INVOLVED?

In late 2016, prosecutors arrested Park's friend Choi Soon-sil on suspicion of exerting inappropriate influence over state affairs after Park allowed Choi to edit draft speeches. Court documents showed that Park pressed conglomerates including Samsung Group to make donations to Choi-backed foundations and separately asked Samsung to support the equestrian training of Choi's daughter. Park was impeached in March 2017, making her the country's first democratically elected leader to be ousted from office. At her trial, she denied wrongdoing.

Samsung heir Lee was arrested a month earlier, accused of seeking presidential favours in exchange for extending Choi financial support. Samsung and Lee denied wrongdoing.

2. WHAT DECISION CAN THE SUPREME COURT TAKE?

Lee was found guilty in August 2017 on charges including bribery and embezzlement and received a five-year jail term. He was released five months later after an appeals court halved and suspended the sentence. Both Lee and prosecutors appealed to the Supreme Court, which can uphold the appeals court's ruling or ask it to reconsider its judgment. The latter could lead to the conviction being overturned or to a tougher sentence, legal experts said. A sentence any longer than three years would mean immediate incarceration, as a suspension is only permitted for terms of up to three years.

3. WHAT ARE THE STICKING POINTS?

The case centres on whether three horses donated by Samsung for the training of Choi's daughter should be considered bribes aimed at winning Park's favour. Court documents showed that Park asked Lee to help the daughter, and was convicted on grounds that the horses were bribes worth 3.7 billion won (S$4.2 million). However, the horses were not recognised as such in Lee's trial, helping reduce his sentence. The court may also rule on whether there were any quid pro quo dealings between Park and Lee. Ruling in the affirmative could increase the severity of their punishment.

 
 
 

4. WHAT DOES IT MEAN FOR SAMSUNG?

Lee is poised to take control of the Samsung Group from his aged father. His titles include vice-chairman of Samsung Electronics, the world's biggest maker of smartphones and memory chips.

Samsung Electronics is currently battling falling profitability as prices of chips and display panels slide. It also has to contend with Japan's decision last month to restrict exports of chipmaking chemicals to South Korea following a diplomatic dispute. Japan dominates the market for the restricted chemicals.

Lee has since embarked on a high-profile mission to tackle what he called a crisis. Other group headaches include investigations at Samsung BioLogics which prosecutors suspect breached accounting rules.