South Korean Prosecutors Charge Samsung Chief With Tax Evasion | Voice of America - English
The chairman of one of the world's biggest and best-known corporations is facing criminal charges for tax evasion and other alleged misdeeds. Samsung Chairman Lee Kun-hee, arguably the most powerful businessman in South Korea, is believed to be unlikely to go to jail because his company is too crucial to his country's economy.
A three-month probe by South Korean special prosecutors reached its climax, Thursday, with some good news for the country's largest corporation, and some bad news for its chairman. Investigators say they found no real evidence Samsung used a massive secret slush fund to bribe government officials. Earlier this year, a senior Samsung lawyer accused the company of tucking away more than $190 million for that purpose, prompting lawmakers to order the investigation. However, Samsung group Chairman Lee Kun-hee and nine of his associates will face other charges of corrupt financial dealings. Chief prosecutor Cho Joon-woong announced the charges on live nationwide television, Thursday. He says investigators found that more than a thousand borrowed-name accounts were used illegally to make profits from selling shares of Samsung Electronics and other affiliates. He also says Chairman Lee evaded about $112 million worth of taxes. Lee and his associates also face breach of trust charges for allegedly transferring control of the Samsung group illegally from the 66-year-old chairman to his son. Samsung is a globally recognized brand. It is the biggest of a handful of South Korean "chaebols" - family-held mega-businesses that played a major role in this country's 50-year explosion to the world's 12th-largest economy. About three years ago, a South Korean network produced a drama series called "Hero Generation" about Chairman Lee and his father, Samsung's founder. The show is just one example of the ways in which South Korean media tend to elevate Chairman Lee and his company to demigod-like status. Samsung products and services account for about a fifth of South Korea's total exports. Prosecutors say Lee and his associates are free, pending trial, in part to avoid a negative impact on the country's economy. For the same reason, analysts believe Lee will face little or no jail time, if convicted. The Samsung case has sparked a public debate about corporate corruption in South Korea. Many South Koreans have come to accept corruption as a cost of doing business. However, there are beginning to be calls for increased corporate responsibility. The Samsung corporation released a statement, apologizing for causing concern and promising to initiate reforms it will disclose to the public soon.