Samsung Chief Lee Jae-yong just received a huge legal relief after an appeals court cleared him of all criminal charges related to the merger of Chiel Industries and Samsung C&T in 2015. Lee was accused of accounting fraud and stock manipulation to strengthen his hold on the company following the merger. Prosecutors demanded a five-year jail term for the de-facto Samsung leader, but he now walks free.
Samsung Chief cleared of all charges in the 2015 merger case
In 2015, Samsung completed a high-profile merger of two of its subsidiaries — where three Samsung C&T shares were offered for one Cheil share — amid wide public interest. A couple of years after this merger, South Korean state prosecutors accused Lee of accounting fraud, stock manipulation, and embezzlement related to this merger.
The Samsung Chief allegedly manipulated stock prices to favor the merger, intentionally causing losses to stockholders. The deal effectively helped him tighten his control of the merged entity. Prosecutors demanded a five-year jail term for Lee, alongside a hefty fine. However, a lower court found him not guilty of any of the charges pressed against him.
Unsurprisingly, prosecutors appealed to the higher court, but the appeal has been dismissed. The Seoul High Court upheld the lower court’s ruling, clearing Lee of all charges in this case. The Samsung Chief has already served around 18 months in prison in a bribery case involving former South Korean President Park Geun-hye. He received a presidential pardon in this case in August 2022.
“It took a long time,” Lee’s lawyer said after the ruling. “We hope with the latest ruling, the defendants would be able to focus on their work.” Samsung certainly hopes that this is the end of decade-long legal troubles for its Chairman. Lee became the Chairman of Samsung Electronics in October 2022, having served the company as Vice Chairman since December 2012.
