SEOUL, June 27 (Korea Bizwire) — Samsung Group heir apparent Lee Jae-yong was granted a respite Friday in a legal battle over his alleged role in a controversial merger and fraudulent accounting, as an independent panel of experts concluded that prosecutors should not indict him.
However, Samsung is still cautious as Lee’s legal battle is not over.
After hours of discussion, the panel, made up of civil activists, legal experts and others, concurred that the investigation into Lee unwarranted, giving a breather to Samsung and its de facto leader.
“We respect the decision from the committee,” Lee’s lawyers said in a release. “We thank the committee for giving Lee and Samsung a chance to focus on their business activities and overcome the current crisis.”
Early this month, a few days ahead of a court ruling over his detention, Lee, vice chairman at Samsung Electronics Co., requested the panel review whether prosecutors’ investigation is fair, seeking public support for the high-stake legal battle.
The independent panel was introduced two years ago to enhance neutrality and fairness of prosecutors’ probes into cases that are of great public interest. In a nutshell, the panel was created to rein in prosecutors’ powers.
The panel’s decision is not legally binding, but if history is any guide, its recommendation has been convincing enough to affect prosecutors’ probes.
Since the introduction of the scheme, the panel has issued recommendations in eight cases, and the prosecution has followed all of them.
Prosecutors suspect that Lee and the group’s top management were involved in a calibrated scheme to intentionally lower the value of Samsung C&T Corp. prior to its merger with Cheil Industries Inc. in 2015, so as to facilitate Lee’s managerial succession from his ailing father, Lee Kun-hee.
Prosecutors sought an arrest warrant for Lee, but their request was denied by the Seoul Central District Court on June 9.
Samsung has been strongly denying such allegations, saying Lee was not involved in any decision-making process regarding the 2015 merger, and there was no stock price manipulation or unfair trading.
Even though Lee avoided detention and the panel ruled in favor of his side, Samsung is not in celebration mode as uncertainties surrounding the heir apparent remain.
Though the committee’s conclusion could weigh on the decision process, prosecutors could still indict Lee. Samsung hopes the prosecution follow predecents set by the panel’s advisory.
In addition, Lee is still dealing with a bribery case that put him behind bars a couple years ago.
Lee was imprisoned for about a year in 2017 for bribing a confidant of former President Park Geun-hye in return for her administration’s support for the 2015 merger.
He was released in February 2018 after his sentence was suspended by an appeals court, but the Supreme Court last year ordered a retrial.
Despite ongoing legal battles, Lee has been active in taking care of Samsung’s business to overcome the COVID-19 pandemic and renewed tensions between the United States and China.
He recently visited Samsung Electronics’ chip R&D center and home appliance business unit in South Korea to check their future strategies.
Lee also met with Hyundai Motor Group heir Chung Euisun last month to discuss possible cooperation in the electric vehicle (EV) business as the group’s affiliate Samsung SDI Co. produces EV batteries.
Lee has been especially focusing on Samsung’s chip business since he got out of jail in 2018.
In April last year, Samsung Electronics, the group’s crown jewel, announced a vision to become the world’s No. 1 logic chip maker by 2030 by investing 133 trillion won (US$111 billion) and bolstering its competitiveness in the system LSI and foundry businesses.
Samsung Electronics, the world’s leading memory chip and smartphone maker, recently announced the addition of new foundry and NAND flash production facilities in South Korea.