Samsung heir denies involvement in key merger in graft trial
The prosecution accuses Lee Jae-yong of soliciting a favour from the former South Korea President Park Geun-hye to pull off the merger to cement his control in the conglomerate.world Updated: Aug 02, 2017 20:17 IST
Jailed Samsung Group scion Lee Jae-yong on Wednesday denied his involvement in the merger of two group units in his first court interrogation on corruption charges in connection with a scandal that removed President Park Geun-hye from office early this year.
Lee was arrested on February 17 on charges of giving and pledging some 43 billion won ($38.2 million) to two foundations controlled by Park’s longtime friend Choi Soon-sil in exchange for government backing on the merger of Samsung C&T Corp and Cheil Industries Inc in 2015, Yonhap news agency reported.
The prosecution accuses Lee of soliciting a favour from the former President to pull off the merger to cement his control in the conglomerate. The state-funded National Pension Service (NPS), which owns a major stake in Samsung C&T, was seen as holding the casting vote.
The 49-year-old Samsung Electronics Co vice-chairman made his first testimony during the 50th session of his trial that began in April.
Lee denied that he was ever in a position to make management decisions, since he never belonged to the now-disbanded group control tower, the Future Strategy Office.
He stressed that the decision to merge the two units was made by the office and he only followed the advice by the office’s head, Choi Gee-sung, in carrying out the merger.
“I have no knowledge of the business that Samsung C&T and Cheil Industries were involved in. The merger was carried out by the executives of the Future Strategy Office,” Lee said.
He argued that his scope of work and power was strictly confined to Samsung Electronics, the crown jewel of the conglomerate.
“I never belonged to the Future Strategy Office,” Lee said. “I’ve belonged to Samsung Electronics and 95% of my work was related to Samsung Electronics and its related affiliates.”
But he mentioned that he began to have “a few more jobs” as the group’s representative since his father and the group’s patriarch Lee Kun-hee was incapacitated after having a heart attack in 2014.
The scion of South Korea’s richest conglomerate also faces a string of other accusations including embezzlement, perjury and hiding assets overseas. Part of Samsung’s contribution was sponsoring the equestrian training of Chung Yoo-ra, Choi’s 21-year-old daughter, in Germany.
The prosecution is expected to deliver its sentencing request on Lee on Monday and the court will deliver its verdict later this month.
Earlier in the day, co-defendant Choi Gee-sung took the stand in court, defending his boss by saying that he approved of Samsung’s sponsorship for Chung at his discretion.
He also denied the prosecution’s claim that the sponsorship was eventually intended for Samsung’s leadership transfer, saying that “the vice chairman is already being recognized as the successor in and outside.”
First Published: Aug 02, 2017 20:17 IST