The decision eliminates the executive’s further prospect of jail time.
According to a report by The Financial Times, Samsung chairman Jay Y. Lee recently received an acquittal from a Korean court on allegations of stock manipulation and accounting fraud related to a merger that occurred in 2015. This may indicate that his legal issues are now in the past. As a result of the verdict, Lee is able to continue managing Samsung, which had a significant drop in revenue in the previous year.
According to the allegations made by the prosecution, Lee manipulated the share price of two Samsung businesses in order to facilitate a merger that would allow him to consolidate his authority. The prosecution is seeking a prison sentence of five years. But the Seoul Central District Court decided that the prosecution did not provide sufficient evidence to support their claim. “It is hard to say that Lee Jae-yong [aka Jay Y. Lee]. . . spearheaded the merger, and that the merger was done just for the sake of Lee’s succession,” according to the verdict issued by the judge.
After the verdict is handed down, Lee and Samsung will be able to concentrate on their deteriorating smartphone and memory chip businesses. As of late, Samsung has been surpassed by Apple in terms of smartphone sales, and it is currently trailing behind SK Hynix in the emerging and competitive market for high-bandwidth memory (HBM), which is utilized by NVIDIA and other companies in the development of artificial intelligence (AI) models.
Despite the fact that the move was praised by various business organizations, such as the Korea Chamber of Commerce and Industry, not all people in the country were in agreement with it. “The ruling will free Lee of legal risks, but I am at a loss for words in terms of the country’s economic justice,” Park Ju-geun, head of business thinktank Leaders Index, said in an interview with the Financial Times. “This goes totally against all previous court rulings on the merger.”
After being found guilty of bribing governmental authorities on the same merger in 2017, Lee was first sentenced to five years in prison for his actions. After being held in custody for a year, he was eventually released; however, the South Korean Supreme Court reversed that ruling and ordered that the case be retried.
Despite the fact that Lee was given a sentence of two and a half years in jail during that retrial, which took place in the beginning of 2021, he was granted release half a year later. This was a development that civil groups had labeled as yet another instance of the court system being indulgent toward the country’s influential individuals. (For her part in the same scandal, Park Geun-hye, who had previously served as president of Korea, was also sentenced to prison.)
In the year 2022, South Korean President Yoon Suk Yeol granted Lee a pardon, reportedly so that he could assist the nation in overcoming its economic crisis. To add insult to injury, Yoon is the former head prosecutor of the country and was responsible for overseeing the initial convictions of Lee and Park.