Ex-minister abused power for Samsung merger: court

Moon Hyung-pyo, former minister of health and welfare, walks into the courtroom at the Seoul Central District Court in southern Seoul, Thursday. / Yonhap

By Jung Min-ho

Former health minister Moon Hyung-pyo has been found guilty of abusing his authority in the merger of two Samsung units in 2015.

The Seoul Central District Court sentenced Moon to two-and-a-half years in prison, Thursday, for pressuring the National Pension Service (NSP), a key shareholder of the Samsung units ― Samsung C&T and Cheil Industries ― to vote for the merger when he was minister of health and welfare.

It was deemed a critical decision for Samsung Group scion Lee Jae-yong to tighten his grip on group management.

Hong Wan-seon, former chief official for the NSP’s investment plans, was also sentenced to two-and-a-half years in prison for colluding in committing the crime.

The ruling is expected to affect the bribery trial involving Lee, former President Park Geun-hye and her friend Choi Soon-sil. Lee, vice president of Samsung Electronics, is charged with offering 43 billion won ($38 million) in bribes to the two in return for the NSP vote.

Park Young-soo, the special prosecutor appointed for the corruption scandal that eventually removed the former president from power, alleged that Lee and some other Samsung major shareholders gained about 855 billion won with the decision ― at the expense of 139 billion won of taxpayer money.

“Moon seriously infringed on the independence of the NSP,” the court said in the ruling. “He ordered ministry officials to pressure the NSP to make the decision.”

“As a result, the NSP lost its assets and Lee and some others gained financial benefits.”

Moon was also found guilty of perjury over the false testimony he made during the National Assembly’s hearings on the scandal last year.

The court said Hong ordered his staff to manipulate data about the merger and use it to persuade the NSP investment board members to support the merger, which they eventually did.

“Hong was supposed to follow the rules in making investment decisions, which he ignored to help the merger,” the court said.

Hong, who had been tried without physical detention, was immediately put in jail, following the ruling.

The special prosecutor believed the former president ordered Moon to push for the merger through former presidential secretary An Chong-bum.

If the alleged link between Samsung’s support and the NPS decision is proved in court, Lee, who has led the company since his father, Lee Kun-hee, collapsed from an acute myocardial infarction in 2014, will face bribery charges, which could put him behind bars for many years.

For taking the bribe, the former president and Choi could face life sentences.

Samsung’s legal representatives have insisted that Lee was a victim ― not an accomplice ― in the scandal, saying the firm simply made donations for various government projects without expecting to receive anything in return.