Samsung’s heir and de facto boss benefited from a presidential pardon on Friday, the latest example of a long South Korean tradition of leniency towards big bosses convicted of corruption and other financial crimes. Rationale: Contribute to the economy.
Billionaire Lee Jae-yong, who was convicted of bribery and embezzlement last January, will be “rehired” to “help overcome South Korea’s economic crisis,” Justice Minister Han Dong-hoon said.
Mr Lee, 54 – the 278th richest person in the world according to Forbes – was conditionally released in August 2021 after serving 18 months in prison, just over half his original sentence.
Friday’s pardon will allow him to fully return to work and lift the court-imposed ban on him serving five years after his sentence.
“Due to the global economic crisis, the dynamism and vitality of the national economy has deteriorated, and there are fears that the economic slump will be prolonged,” said a statement from the Ministry of Justice.
– “growth engine” –
The ministry hopes the businessman can “lead the country’s growth engine by actively investing in technology and creating jobs.”
Lee Jae-yong was pardoned along with three other businessmen, including Lotte Group chairman Shin Dong-bin, who was sentenced to a two-and-a-half-year suspended sentence in a corruption case in 2018.
On the day of Japan’s surrender in 1945, a total of 1,693 people were pardoned, including prisoners who were seriously ill or at the end of their sentences.
In a press release following his pardon, Mr. Lee pledged that he would “contribute to the economy through continued investment and job creation for young people.”
Mr. Lee is Vice President of Samsung Electronics, the world’s largest smartphone maker. The conglomerate’s total sales are equivalent to one-fifth of South Korea’s gross domestic product.
He was jailed for offenses related to a massive corruption scandal that ousted former President Park Geun-hye.
Big South Korean tycoons are often accused of corruption, embezzlement, tax evasion or other illegal economic activities.
But many had their sentences reduced or suspended on appeal, and some – including the late Samsung chairman Lee Kun-hee, who was convicted twice – were pardoned by the president in recognition of their “contribution to the ‘national economy.’
South Korean President Yoon Suk-yeol said Friday the pardons were aimed at improving the lot of “ordinary people affected by the ongoing Covid-19 pandemic.”
“I hope this special pardon is an opportunity for all South Koreans to work together to overcome the economic crisis,” he added.
But according to analysts, these pardons simply made big businessmen feel like they were “unconstrained by any legal standard,” Vladimir Tikhonov, a professor of Korean studies at Oslo University’s institute, told AFP.
– “disadvantageous” –
“And the government does more or less what it wants and creates the conditions for capital accumulation” for companies, he said.
Mr. Lee still faces a separate trial for accounting fraud related to a 2015 merger of two Samsung companies.
In May, he was excused from attending a hearing as part of that process to greet President Yoon as well as US President Joe Biden, who was in South Korea to visit Samsung’s chip factory.
Mr. Lee’s pardon comes after Samsung unveiled a massive 450 trillion won ($356 billion) investment plan over the next five years aimed at expanding the company into a variety of sectors – from semiconductors to electronics Biologics – to become a leading company and create 80,000 new jobs.
The company also employs about 20,000 people in the United States, where a new semiconductor fab is under construction in Texas, expected to open in 2024.
But the tycoon’s imprisonment hasn’t impacted the performance of the company, which reported a more than 70% increase in profit in the second quarter of last year as the shift to remote work boosted demand for devices powered by its memory chips.
“Samsung worked perfectly without any mercy,” observed Mr. Tikhonov.
“Grace weakens the rule of law, which is actually more detrimental than beneficial to the functioning of any market economy,” he said.