Samsung Chief awarded Five Years Jail

South Korean shares were dented by declines in Samsung Group shares with the Korea Composite Stock Price Index (KOSPI) closing down 0.4 percent at 2,370.30 points.

The Korean-language message from Samsung Electronics' chief executive, Kwon Oh-hyun, which urged employees to continue to work hard and not be distracted, came just three days after a Seoul court sentenced Lee Jae-yong, the company's vice chairman and the Samsung heir, to five years in prison for bribing South Korea's former president.

When millions of people took to the streets to demand president Park Geun-hye's ouster over a burgeoning corruption scandal, their anger was directed nearly as much at the companies that paid her secret confidante Choi Soon Sil, as at her.

Lee was also found guilty of perjury and other offences. Lotte chairman Shin Dong-bin was indicted on bribery charges in April, while Samsung's Lee was sentenced to five years prison. Lee has been accused of offering bribes of 38 million United States dollars for various departments after the death of his father.

They said Lee was aware that Park, president at the time, wanted Samsung to sponsor the equestrian training.

But since Lee's father Lee Kun-hee suffered a heart attack in 2014, he has been considered to run the Samsung empire.

While the Samsung executives never expressly asked for Park's support, the court said, they made the payments to a secret confidant of the former president's with a wink-and-nod understanding characteristic of the way that many South Koreans believe big businesses manipulate politicians. "We hope the high court will do better".

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After the sentencing, Lee's attorneys said they can not accept the verdict, saying they are confident that Lee would be cleared of all charges at an appeals court. Twice convicted of tax evasion and bribery, the elder Lee never spent any time in prison.

The closely-watched verdict is the latest convulsion in a political scandal that prompted millions of South Koreans to protest last fall, culminating in the ouster and arrest of Park as well as the arrests of Choi and Lee.

The decision will test whether Samsung can succeed without the crown prince of the Lee family at the helm. Instead, Samsung has insisted that a merger of two Samsung companies at the centre of the scandal was about creating business benefits.

Thus far, Samsung's revenue equal about one fifth of the country's GDP, and some sources fear the imprisonment of a notable commercial figure may cause ripple effects through the country.

Kim said that as the group's heir apparent, Lee "stood to benefit the most" from any political favours for Samsung.

"From the government's perspective, this solves the short-term problem", Park, the professor, said of the guilty verdict.

  • Desiree Holland