Share |

Samsung family chief indicted

South Korean prosecutors investigating allegations of slush funds, bribery and illegal wealth transfer at the Samsung Group have charged second-generation chairman Lee Kun-hee with tax evasion and breach of trust.

Lee, 66, is claimed to have hidden $4.5 billion in borrowed-name accounts, evading $112.8 million in taxes. He was also charged with breach of trust for overlooking the group's illegal wealth transfer to his son through a below-market price deal involving Samsung's holding company.

Special prosecutor Cho Joon-woong said Samsung's strategic planning office, which is the "control tower" of the group's alleged irregularities, systematically plotted or orchestrated the father-to-son wealth transfer.

Nine other executives, including vice chairman Lee Hak-soo, were also indicted. The results of the 99-day investigation were announced at a televised press conference.

None of the 10 have been arrested as officials claimed the wrongdoing was aimed at protecting the family-oriented management system, not to help fulfil Lee's personal greed. Arrest would also disproportionally affect the Korean economy they said.

Cho was unable to find evidence against Samsung officials bribing prosecutors and ranking government officials with slush funds.

Samsung heir apparent Lee Jae-yong and his mother Hong Ra-hee were cleared of all allegations. Hong was accused of purchasing expensive paintings with the group's slush funds. If found guilty, chairman Lee could face life imprisonment.

Click here >>
Close