By Anandita Mehta
The Samsung Group heir and de facto business leader, Lee Jae-yong, was convicted on Aug. 25 on charges of bribery and sentenced to five years in prison, The New York Times reported.
Lee was convicted for bribing former South Korean President Park Geun-hye in hopes of gaining government backing of a corporate merger that had been opposed by shareholders. The merger would have also given the Lee family greater control over the Samsung corporation, according to The New York Times.
Samsung was founded, owned and operated by the Lee family starting in 1938, Fortune reported.
South Korean family-owned business conglomerates like the Lees helped revive South Korea’s economy after the Korean war from 1950 to 1953, according to Reuters.
By helping to transform the nation into a “global economic powerhouse,” families such as the Lee’s were given immunity from the law, according to Reuters. For example, Lee’s father, Lee Kun-hee, received two presidential pardons absolving him of any punishment for convictions of bribery and other charges, according to The New York Times.
Now Reuters reports that these same families actually stunt economic growth by stifling the prospects of small businesses.
South Korean President Moon Jae-in has already announced that there will be no more presidential pardons, according to BBC.
Reuters also reports a rise in the share prices of Samsung when Lee was taken into custody, indicating public approval of the president’s action, and public disapproval of the youngest Lee.
The youngest Lee, seen as awkward and nervous, only became the head of Samsung after health issues put Lee’s father into a coma. Whereas his father and grandfather commanded respect as leaders that participated in decision making, the youngest Lee was not taking part in the daily decision making of the business, The New York Times wrote.
Lee even told the courts that “he mostly reads American and Japanese publications instead of South Korean news outlets, leaving him ignorant of which officials he would need to influence to begin with,” The New York Times reported.
Lee and his lawyers have taken a stance of innocence, claiming that the documents signing over money as part of a bribe were signed without his understanding of their implications, according to The New York Times.
Samsung opened an office near Lee’s jail, therefore, his imprisonment did not create a power vacuum, and will not impede the operations of the company, according to The New York Times.
As for the president on the receiving end of those bribes, Park is facing her own trial and was forced to leave the position of the presidency, according to Fortune. However, she is not without supporters, as those who oppose her trial were seen protesting outside the court the day of Lee’s sentencing because of the ill omens it holds for Park.