Court set to decide on Samsung heir’s arrest

Jun 08, 2020, 09:30 am

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Samsung Electronics Vice Chairman Lee Jae-yong/ Source: Yonhap

AsiaToday reporter Hwang Eui-joong

A Seoul court will hold a hearing Monday to decide whether Samsung Electronics Vice Chairman Lee Jae-yong should be arrested over his possible involvement in an accounting fraud of Samsung Biologics as well as a controversial merger of two group affiliates, Samsung C&T and Cheil Industries, in a suspected bid to facilitate his managerial succession from his father Lee Kun-hee. The Samsung heir was arrested for allegedly seeking political support for the controversial merger and spent a year in prison before being released on probation by an appeals court. If the arrest warrant is approved, Lee will return to prison in two years and four months after release, which Samsung claims will trigger a leadership crisis in the nation’s biggest conglomerate in post-COVID-19 era where rapid response and investment is necessary.

According to business circles on Sunday, Lee will attend a hearing and be held in the detention center. The court’s decision is expected to come out later in the day or early next morning.

Samsung released a statement Sunday in a last-minute effort to save its de-facto leader. The absence of leadership can be a major risk in the post COVID-19 era where it is important to respond quickly to changing global business environment. Samsung, which has set a goal of becoming the world’s No.1 system-on-chip business by the year 2030 and has invested more than 15 trillion won in a cutting-edge foundry manufacturing line and memory production line in Pyeongtaek, should make a big decision to make massive investment in the future.

In the statement, Samsung said it will respect the decision made by the court regardless of what conclusion the prosecution reaches. However, Samsung commented that “(speculative) reports raise concerns of distorting objective judicial judgment and are undesirable, not only for Samsung but also for the future of our economy.”

“The long-term prosecution investigation has dampened regular management. The coronavirus crisis and the trade dispute between the US and China are intensifying the external uncertainties,” Samsung said. “The current crisis is something that Samsung has never experienced before,” it said. The group further asked the media to help the company so that Samsung can take on the role in overcoming the nation’s economic crisis.

The appeal was made as the prosecutors were intensifying their investigation involving the Samsung heir. Lee has been called to the judicial authorities for four years since 2016. In particular, the prosecutors filed an arrest warrant for the Samsung chief two days after Lee asked the prosecution to form an investigation deliberation committee under the Supreme Prosecutors’ Office last Tuesday to have outside experts judge the validity of prosecutorial investigation and indictment.

The company says it has been very cooperative with over 50 search and seizures of the company and 110 senior employees being summoned for questioning a total of 430 times. Despite the cooperation, if the court issues the warrant, it could nullify Samsung’s request for an outside expert review panel.

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