Tech giant with a chequered history

SEOUL • South Korean giant Samsung has a chequered history, with its founder, his son and grandson all having had run-ins with the law. It began as a grocery store in Daegu in 1938 when Mr Lee Byung Chul moved away from his family in Uiryeong county. It grew fast, expanding to Seoul in 1947, before Mr Lee branched out into fertiliser, textiles, insurance and electronics in the 1960s.

But scandal engulfed him when the firm's fertiliser unit was caught smuggling artificial sweetener amid allegations he had planned to share the proceeds with corrupt politicians. He avoided jail in return for "donating" the fertiliser unit to the state, but his second-born son served six months in prison.

Mr Lee's third son Kun Hee, who inherited the firm, was also engulfed in legal turmoil. He was charged with bribing then President Roh Tae Woo and given a two-year suspended sentence in 1996. Almost a decade later, prosecutors questioned him after audio tapes of company executives discussing ways to bribe politicians and state prosecutors were leaked. Samsung issued a public apology and donated 800 billion won (S$996 million) to charity.

Two years later, Mr Lee Kun Hee was in hot water again when a former Samsung lawyer claimed he had bribed government officials on Mr Lee's orders. A special law was enacted in 2007 to probe Samsung, Mr Lee and his son Jae Yong, who was not formally charged.

Mr Lee Kun Hee was indicted for tax evasion and other charges, and given three years' jail, suspended for five years. But he was pardoned a year later.


A version of this article appeared in the print edition of The Straits Times on February 18, 2017, with the headline 'Tech giant with a chequered history'. Print Edition | Subscribe