In South Korea, the boss of Samsung pardoned by the president in order to help the national economy

Billionaire Lee Jae-yong, convicted of corruption and embezzlement last January, received a presidential pardon on Friday August 12. The heir and de facto boss of the Samsung group will be “reinstated” pour “to help overcome the economic crisis in South Korea”Justice Minister Han Dong-hoon said.

This pardon is the latest example of a long South Korean tradition of leniency against big bosses convicted of corruption and other financial crimes.

Mr. Lee, 54 – the 278e richest person in the world according to Forbes – had been conditionally released in August 2021, after serving eighteen months in prison, just over half of his original sentence. Friday’s pardon will allow him to return to work fully, lifting the ban on employment that was imposed on him by the court for a period of five years after his prison sentence.

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“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”, the Department of Justice said in a statement. The latter hopes that the businessman can “lead the country’s engine of growth by actively investing in technology and creating jobs”.

A turnover equivalent to a fifth of the country’s GDP

Lee Jae-yong was granted the pardon along with three other businessmen, including Lotte Group chairman Shin Dong-bin, who received a two-and-a-half-year suspended prison sentence in a corruption case in 2018.

Mr. Lee is the vice president of Samsung Electronics, the world’s largest smartphone maker. The conglomerate’s overall revenue is equivalent to one-fifth of South Korea’s gross domestic product. He was jailed for offenses related to a massive corruption scandal that brought down former president Park Geun-hye.

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It is not uncommon for major South Korean tycoons to be accused of corruption, embezzlement, tax evasion or other illegal economic activities. But many have had their sentences reduced or suspended on appeal, and some – including the late Samsung chairman Lee Kun-hee, who was twice convicted – have received presidential pardons in recognition of their “contribution to the national economy”.

South Korean President Yoon Seok-youl said on Friday that the pardons were aimed at improving the lot of “ordinary people who have been affected by the prolonged Covid-19 pandemic”. “I hope this special pardon will be an opportunity for all South Koreans to work together to overcome the economic crisis”he added.

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A separate lawsuit for accounting fraud

Mr. Lee is still facing a separate trial on charges of accounting fraud relating to a merger of two Samsung companies in 2015. In May, he was excused from attending a hearing in that trial to accommodate , alongside President Yoon, US President Joe Biden, who was on tour in South Korea, in particular to visit the Samsung chip factory.

The pardon granted to Mr Lee comes after Samsung presented a massive investment plan of 450 trillion won (about 345 billion euros) for the next five years, aimed at making the company a leader in a wide range of sectors – from semiconductors to biologics – and to create 80,000 new jobs. The company also employs some 20,000 people in the United States, where a new semiconductor factory is under construction in Texas, slated to open in 2024.

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But the tycoon’s imprisonment has not hampered the performance of the company, which reported a more than 70% rise in profits in the second quarter of last year as the shift to remote working boosted demand of devices using its memory chips.

The World with AFP

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