Prosecutors seek warrant to arrest Samsung's heir, Jay Lee

Samsung's vice chairman and heir, Jay Lee who is facing prosecution over alleged merger fraud
EJ
Emeh Joy

South Korean prosecutors reportedly filed an arrest warrant for Samsung Group's heir, Jay Lee and two other former company executives on Thursday as part of an ongoing investigation into an alleged accounting fraud and a controversial merger which has greatly affected the country.

Lee appeared before prosecutors in May where he was questioned as regards the merger of two Samsung units. The prosecutors suspected that the value of Cheil industries (an electronic devices provider) was inflated intentionally before it was merged in 2015 with Samsung C&T, Samsung Group's de facto holdings company.

The reason for this inflation would be to achieve a favourable rate for the heir, who was at that point in time, the biggest shareholder in Cheil Industries.

Before Lee's case, several of other current and former Samsung executives had been questioned as part of the continuous investigation which commenced in 2018 at the request of the Financial Services Commission.

According to local reports, prosecutors have extended their investigations into the allegations that Lee had committed a breach of trust as well as violated the Financial Investment Services and Capital Markets Act.

Samsung Group is South Korea's largest conglomerate with not less than $400 billion of market value. However, this company has struggled with legal issues for years. Many executives have been questioned, investigated, indicted or arrested over charges ranging from graft and accounting issues to union-busting.

In lee's case, critics have argued that the merger made Lee the largest shareholder of Samsung's de-facto holding company and smoothed the way for his succession from his ailing father.

Lee has previously denied the charges, and at the moment of this report, Samsung could not be reached for comment.

Share With Friends