Samsung raided over scandal involving former president Lee
[THE INVESTOR] Prosecutors raided the offices of Samsung Electronics and a house in Seoul belonging to a former Samsung executive as part of their investigation into a scandal involving former President Lee Myung-bak.
Through Feb. 8-9, inspectors from the Seoul Central Prosecutors’ Office conducted the raid at several locations including the Samsung headquarters and R&D center in southern Seoul, and the house of former vice chairman Lee Hak-soo, who was the right-hand man to ailing Samsung Chairman Lee Kun-hee.
“It is very concerning that the company has been involved once again in a controversial scandal with a former president during the time it really needs to focus on getting its businesses back on track,” said a Samsung official who wished to be unnamed.
It is said that the prosecution has found suspicious money transactions between DAS, an auto parts supplier, and the tech giant.
Lee Myung-bak’s elder brother Lee Sang-eun holds a majority stake of the auto parts company, but the former president is said to have masterminded the transaction.
Samsung, through its New Jersey and San Francisco offices, allegedly paid fees for DAS in 2009, which was then involved in a lawsuit with investment consulting firm BBK in the US to retrieve a 14 billion-won (US$12.9 million) investment.
The former Korean president, who was in office from 2008 to 2013, had allegedly abused his influence to recoup the investment from Kim Gyeong-joon, the CEO of the US consulting firm, who had embezzled funds raised from investors.
The prosecution became aware of Samsung’s alleged financial support during its ongoing probe into a former official from the presidential office, who had helped DAS to hire a US law firm in the lawsuit.
Industry watchers say the new allegations linked to the former president will likely deal a serious blow to the Korean tech behemoth, which has kept a low profile since its de facto leader Lee Jae-yong was released from prison on Feb. 5.
By Kim Young-won (firstname.lastname@example.org)