Samsung’s new executive chairman Lee Jae-yong has a history of bribery, corruption

Tech major Samsung has declared that third-generation heir Lee Jae-yong will be the next executive chairman. Lee previously held the position of vice chairman. Lee, who is famous as Lee Jae-yong, has been at the helm of Samsung as its de facto leader since 2014 after his father slipped into coma after suffering a heart attack.  

Lee’s past and conviction 

Lee’s promotion as the executive chairman was obvious as he had headed the most valuable company in South Korea ever since his father, former chairman Lee Kun-hee, retired from his active role after suffering a heart attack in 2014.

But due to his (Lee’s) legal tussles, the company board was reluctant in elevating him as the chairman after Lee Kun-hee’s death in 2020. 

In 2017, Lee Jae-yong was accused of bribery and embezzlement, where it was said that he had bribed a former president in a corruption scandal that toppled the government ruling at that time. Lee was found guilty of bribery, embezzlement, and concealment of criminal proceeds worth about $6 million. The case involved the country's former President Park Guen-hye, who was also jailed for bribery and corruption. 

Lee was twice sent behind bars in the corruption case. In August last year, Lee was released from a South Korean prison on parole after serving 207 days in jail.  

After a year, the South Korean government granted him a special presidential pardon, which ended his five-year ban holding a formal position at Samsung.  

Samsung’s growth and challenges 

The tech major has been facing a lot of challenges due to soaring inflation, geopolitical tensions due to the Russia-Ukraine war, rising interest rates, and fears of recession. 

On Thursday, the smartphone manufacturer reported a 31 per cent drop in its third-quarter profit. The company reported that it had made nearly $7.6 billion in the third quarter as compared to $11.1 billion in the same period last year. 

The company said geopolitical uncertainties are likely to dampen demand at least through the first half of 2023. It said demand could recover later next year, driven by chips required for new data centres and computer products.