[THE INVESTOR] Samsung heir Lee Jae-yong is behind bars. He is expected to face some tough questioning starting tomorrow at the earliest.
Even Samsung appeared to be at a loss, for it had not anticipated the arrest of a man leading South Korea’s largest company. In a sense, it could have been complacence. He was already once released after questioning, and he and his team of lawyers probably thought he aced the previous parliamentary hearings with his “dumb act.”
From a strictly legal point of view, it appears there was much to suspect that Lee or his company has indeed given or promised some tens of millions worth of worth of bribes to Choi in exchange for the government‘s backing of a merger of two Samsung affiliates back in 2015.
Samsung seems to have seen the merger critical for the power transition from Samsung Electronics’ Chairman Lee Kun-hee – who has been bedridden since a heart attack he suffered a few years ago – to his son.
The conglomerate has already admitted to making contributions to two nonprofit foundations allegedly controlled by Choi and her Germany-based firm, but denied that they were linked to the merger.
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But from another point of view, the arrest comes across as a strongly symbolic act. The people of Korea are becoming increasingly antsy, tired and frustrated as they are faced with President Park Geun-hye’s persistent attempts to distance herself from the allegations surrounding her.
Other key players of the scandal, namely the president, her confidante Choi Soon-sil, appear determined to make an escape, and the prosecution is having a tough time building its case despite the bevy - a flood, really - of evidence piling up. As a side effect, the economy is paralyzed, while politics and international diplomacy have been thrown into chaos.
Perhaps partly due to this frustration, news about Lee’s arrest was met with a flurry of positive reactions from the public. The media was also quick to spew out sensational headlines, many describing the arrest as a dethronement and the fall of a prince. Some say, “from heir to convict,” referring to Lee’s detainment.
The arrest, assuming it is based on facts and objective investigation, it should more than welcomed as it will prove to the rest of the world that Korean Chaebol, contrary to what the global community believes, is not prone to letting conglomerates get away with murder.
And because the conglomerate in this case is Samsung, the message would be even stronger. It can be likened to how Lee Kun-hee was previously arrested for creating slush funds.
In short, if all is legal and proper, the followup measures should be thorough and firm. It should not end as a symbolic one with punishment being a slap on the wrist, as it had been with his father who had soon been granted a pardon. The arrest may also end up becoming a watershed moment taking the Korean economy and corporate sector towards new levels of corporate maturity.
However, the authorities must be sure that it remains uninfluenced by public sentiment. Making a scapegoat out of a company as big as Samsung that has, despite the many wrongs it has committed on a corporate governance level, would be a sacrifice that would have a toll on the economy that may be irreversible.
By Kim Ji-hyun (email@example.com)