A long-awaited windfall for Samsung
On Friday, Samsung Vice Chairman Jay Y. Lee was released on parole, and after issuing a statement to waiting reporters, he made his way to Samsung’s headquarters. South Korean President Moon Jae-in’s office has claimed that his early parole is in the national interest.
“We are well aware that there are supporting and opposing views on Vice Chairman Jay Y. Lee’s parole,” Moon’s office said in a statement. “The views of the people who are opposed are also right.”
“On the other hand, there have been many people who called for his parole in this severe crisis, hoping that he will help the country with respect to semiconductors and vaccines.”
Samsung was founded in 1938 by Lee’s grandpa. He has been the CEO of Samsung Group since 2014. Although his absence had little effect on Samsung’s everyday operations, Lee is in charge of long-term strategic decisions, and his lengthy absence has caused Samsung’s investment plans to be postponed.
In any given year, the Samsung Group accounts for 10-20% of South Korea’s GDP.
Lee was accused with “bribery, embezzlement, and perjury” in 2017 and sentenced to five years in jail after being found guilty on some of the counts. After a year in prison, the appeals court postponed his sentence and briefly released him.
Lee was sentenced to 30 months in prison by a high court in January, with the previous time spent contributing towards the new sentence. He was scheduled to remain in prison until next year, but the Justice Ministry relaxed their criteria last month to allow for speedier paroles, allowing Lee to walk free after only 18 months.
Lee’s parole is contentious because Moon’s administration ran on a platform of political reform. Lee was convicted of bribing Choi Soon-Sil, a close friend of former President Park Geun-hye. Both Choi and Park are now imprisoned for severe instances of political misconduct, mostly centered around inappropriate ties between the government and South Korea’s large conglomerates.
By releasing Lee early, Moon is breaking a campaign commitment to cut ties in favour of the economic prosperity Lee’s leadership could bring. In any given year, the Samsung Group accounts for 10-20% of South Korea’s GDP.
One of Lee’s next considerations will be where to locate a $17 billion chip factory in the United States. Because of the chip scarcity, both American lobbyists and Samsung’s investors have put pressure on the company’s leadership to finish plans for the fab.
Emerging from the Seoul Detention Center, Lee vowed to be better than before. “I’ve caused much concern for the people,” he said. “I deeply apologize. I am listening to the concerns, criticisms, worries and high expectations for me. I will work hard.”
Despite his forward-looking attitude, Lee’s future is uncertain. He faces complex charges of accounting fraud and stock price manipulation in connection to a 2015 merger that involved the cooperation of Park. He is separately accused of unlawful use of a medicinal sedative.
Lee has denied both charges and will stand trial for them later this year.