The full bench of the Supreme Court of South Korea reversed and remanded the case of Samsung Electronics vice chairman Lee Jae-yong on Aug. 29 and said that the appellate court ruling, 30 months in prison and four years of probation, was wrong. Earlier, the appellate court ruled that neither 3,417.97 million won Samsung spent on three horses nor 1,628 million won it spent to sponsor the Korea Winter Sports Elite Center was a bribe.
After the Choi Soon-sil scandal broke out in the second half of 2016, Samsung Group had to go through repeated searches, seizures and summonses and imprisonment of top executives, including the vice chairman, for three years. Besides, investigations into Samsung BioLogics’ accounting fraud allegations are currently underway.
The vice chairman was released from jail in February last year. Then, Samsung Group came up with a plan to invest 180 trillion won and create 40,000 jobs for three years. The vice chairman sought new business opportunities by visiting a number of countries. Recently, he visited Japan to deal with Japan’s export curbs and visited Samsung Group’s manufacturing facilities in South Korea to promise more investment.
Now, however, things are going against the group again. The vice chairman cannot but focus on his trial for the time being and the group may have to steer itself without him with business conditions already adverse. “The investment and job creation promises he made are expected to be kept regardless of the trial,” an industry insider said, adding, “Nonetheless, the group’s innovation for sustainability and new business exploration are likely to come to a halt.”
Some point out that Samsung may become subject to the Foreign Corrupt Practices Act of the United States. The U.S. government enacted the law in 1977 to prevent American companies from bribing foreign government employees or committing accounting frauds. The law was revised in 2008 for a wider application.