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S Korean court convicts former Samsung head

A South Korean court has convicted former Samsung chairman Lee Kun-hee of evading taxes and has fined him 110 billion won (US$109 million), but said his crimes did not justify a prison term. Prosecutors had demanded a seven-year sentence and 350 billion won in fines for tax evasion and other charges.

“His crime is not serious enough to sentence him to prison,” Judge Min Byung-hun of the Seoul Central District Court said.

While convicting Lee of tax evasion and securities law violations, the court acquitted him of breach of trust charges that stemmed from allegations of dubious financial transactions to transfer corporate control to his son.

The 66-year-old tycoon has personified Samsung Group, which he had led for two decades as it grew into a global brand. He quit as Samsung head earlier this year following his indictment.

“I’m sorry for causing trouble to the people,” Lee said after the verdict, appearing relieved.

The probe against Lee and Samsung was prompted by allegations by a former company lawyer that Samsung created a large slush fund to bribe prosecutors, officials and other influential figures.

Prosecutors said they found 4.5 trillion won of his personal assets under borrowed names and determined he evaded taxes worth 112.8 billion won. Lee was also charged with failing to report to securities authorities changes in the ownership of his stock assets.

The Samsung conglomerate, founded by Lee’s father, consists of dozens of companies.

The group accounts for up to 20 percent of South Korea’s exports by some estimates.
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