Samsung chairman Lee Jae-yong can’t seem to catch a breath. Days after a South Korean court acquitted him in a stock manipulation and fraud case due to lack of evidence, prosecutors have filed an appeal against the ruling. Prosecutors originally sought a five-year jail term and a fine of KRW 500 million (approx. $376,000) for Lee.
State prosecution appeals the acquittal of Samsung chairman
In September 2020, the Korean state prosecution indicted Lee and two senior Samsung executives in a stock price manipulation and accounting fraud case connected to the merger of Samsung C&T and Cheil Industries in 2015. The $8 billion merger strengthened Lee’s grip on the new entity. It effectively increased his chances of succeeding his father as the leader of Samsung Group.
Prosecutors alleged that Lee took to unfair practices to facilitate the merger so he could benefit from it. The Samsung chief was accused of manipulating the stock prices of the two Samsung affiliates, disseminating false market information, and allowing accounting fraud. He denied the allegations saying the merger was part of normal business activity.
Following multiple hearings over three years, the prosecution presented a sentence request to the court in November last year. However, on Monday, the Seoul Central District Court ruled that Lee was not guilty. The other two Samsung executives were also acquitted in the case. The court said prosecutors failed to provide enough evidence to back their claims.
“Even if Lee’s control has been strengthened, the merger, in this case, cannot be considered unfair, as long as there is a reasonable purpose for the merger,” said Chief Judge Park Jung-jae. Prosecutors had until February 13 to appeal the ruling. Unsurprisingly, they took only three days to file the appeal. The hearing dates for the second trial should be known in due course.
Lee has already served jail terms twice since 2017
This isn’t the only legal battle that Lee Jae-yong has been fighting in recent years. He has already been found guilty in a separate bribery case from 2015 involving former South Korean President Park Geun-hye. The Samsung chief served two jail terms between 2017 and 2021 in this case, spending over a year in prison.
He walked out on parole in 2021 and was eventually granted a presidential pardon in 2022. There have been concerns that Lee’s acquittal in the second case will lower the confidence of foreign investors in the Korean legal system. It remains to be seen what comes out of the second trial. Whether Lee will avoid a third jail term, time will tell.
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