Can Samsung leader Lee maintain suspended jail term?

Samsung Group leader Lee Jae-yong arrives at Seoul High Court, Dec. 30, to attend a hearing of his retrial. / Yonhap

By Baek Byung-yeul

Samsung leader Lee Jae-yong could face up to nine years in prison after prosecutors demanded this in the high court's re-hearing of his trial ordered by the Supreme Court.

Lee and top executives of Samsung are having their original high court sentences reassessed following the order, after originally being found guilty of some of the bribery charges laid against them in the case involving the impeachment of former President Park Geun-hye.

The court will deliver its verdict and possible re-sentencing Jan. 18.

Analysts note that a key point is whether Lee can continue serving a suspended sentence so that he can continue to perform hands-on managerial work at Samsung.

They added that it remains to be seen whether the company's establishment of a compliance committee early this year will work in his favor.

The compliance committee, which was launched last February, recently received a constructive review from a court advisory panel, being recognized for its effectiveness as a watchdog in ensuring Samsung abides by the law and improves its management transparency.

The Samsung Vice Chairman Lee was indicted in 2017 for allegedly offering a bribe to Park's confidant, Choi Sun-sil, in order to get support for his taking over of the ownership of the conglomerate.

He was initially sentenced to five years in jail, but was freed after a year when the Seoul High Court reduced this to a suspended two-year term, while dismissing some of the bribery charges laid against him during an appeal hearing.

However, the Supreme Court overturned part of the appeals court ruling in 2019 and sent the case back to the high court, saying charges that Lee offered bribes to Choi had been excluded in the previous ruling.

During the hearing, prosecutors asked the high court to sentence Lee to prison as Samsung actively sought unjust benefits by bribing the former president and her confidant. By applying a strict stance against Samsung they added the case should become an example of the country's efforts to fight corruption.

The Samsung leader gave an emotional final testimony, tearing up several times while vowing not to repeat similar practices in an apparent plea for leniency. “Today, I stand here with a repentant heart. I stand here, pledging to myself that I will not repeat my mistakes again,” Lee told the judges.

In regard to the group's ownership succession issue, Lee reiterated that he won't seek to pass on the management of the conglomerate to his children. The leader also vowed that he will work on facilitating active communication between management and a newly established union.

“Accepting the recommendation made by the compliance committee in May, I revealed my thoughts on ownership succession. I won't let my children even mention anything related to management succession issues. Samsung will never again be controversial for these issues,” Lee said, adding the conglomerate “will create a culture of active communication between the union and management.”

He also said Samsung is doing its utmost to enhance compliance and the committee has helped in creating meaningful progress.

“Meaningful changes are taking place in our company. They are not small changes at all. I myself am also realizing the changes made through compliance management,” Lee said. “When comparing recent meetings to those in the past, the questions I have not asked before have significantly increased. What did the compliance team say? Has the legal team finished its review? Should we bring this issue to the compliance committee? I ask and ask again about anything that could be a problem.”

The Seoul High Court recently made public a report of three experts who assessed the activities of Samsung's compliance committee. The experts ― former Constitutional Court Judge Kang Il-won, attorney Kim Kyung-soo and accountant Hong Soon-tak ― submitted their 83-page final report to the court, Dec. 14.

In the report, the former Constitutional Court judge expressed a positive view on the committee's activities, recognizing its durability and effectiveness.

“What is positive is the committee set an agenda regarding managerial succession, unions and communication with civic organizations and recommended the group improve these,” Kang noted in the report, adding the recommendations clearly helped Samsung improve its compliance system.

The compliance committee was initiated after the court recommended Samsung create an internal watchdog in October 2019, saying this would be taken into consideration at sentencing. How much the judges will take the committee's activities into account could have a huge influence on Lee's sentence.