Billionaire Lee Jae-yong, who was 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” to the “to help overcome the economic crisis in South Korea”said Minister of Justice Han Dong-hoon.
This pardon is the latest in a long South Korean tradition of leniency towards big bosses convicted of corruption and other financial crimes.
Mr Lee, 54 – the 278the the richest person in the world, according to Forbes – had been conditionally released in August 2021 after serving eighteen 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 slackened, and there are fears that the economic slump will be prolonged”, the Justice Department said in a statement. The latter hopes that the businessman can “Lead the country’s growth engine by actively investing in technology and creating jobs”.
A turnover equivalent to a fifth of the country’s GDP
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.
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 brought down former President Park Geun-hye.
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 convicted twice — have received presidential pardons in recognition of their sentences “Contribution to the National Economy”.
South Korean President Yoon Seok-youl said Friday the pardons were aimed at improving the lot “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.
A separate lawsuit alleging accounting fraud
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 in that trial to accommodate US President Joe Biden along with President Yoon. who was traveling in South Korea, especially to visit Samsung’s chip factory.
The pardon granted to Mr. Lee comes after Samsung unveiled a massive investment plan of 450 trillion won over the next five years that aims to make the company a leader in a variety of sectors – from semiconductors to to biologics – to 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, due 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.