Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

Enterprise

Samsung offices raided over influence-peddling scandal

Samsung faces allegations it bribed President Park Geun-Hye’s confidant Choi Soon-Sil to win state approval for a controversial merger it sought last year © AFP/File / Jung Yeon-Je

Seoul, Korea, Republic of, Nov 23 – South Korean prosecutors on Wednesday raided offices of the Samsung Group as the electronics giant is dragged further into a snowballing influence-peddling scandal that has engulfed President Park Geun-Hye.

The raid comes as Samsung faces allegations it bribed Park’s confidant Choi Soon-Sil to win state approval for a controversial merger it sought last year.

Prosecutors visited the group’s Future Strategy Office, which oversees key business decisions, the Yonhap news agency reported.

A Samsung spokesman confirmed the visit by prosecutors but declined to elaborate.

The merger of Cheil Industries and Samsung C&T last year was seen as a crucial step to ensure a smooth third-generational power transfer to Lee Jae-Yong, scion of Samsung’s founding family.

It was criticised by many who said it wilfully undervalued Samsung C&T’s stocks, but Seoul’s National Pension Service (NPS) — a major Samsung shareholder — voted in favour of the deal, which eventually went through.

US hedge fund Elliott Management, which controls about 0.62 percent of Samsung, rallied opposition to the deal, and although it lost the battle its campaign was seen as a watershed moment for shareholder activism in South Korea.

Prosecutors also raided several NPS offices on Wednesday, a NPS spokeswoman said. The pension service is overseen by the welfare ministry and the minister in charge at the time was seen as very close to Park.

Choi has been formally indicted on charges of abuse of power and coercion.

She is accused of leveraging her personal relationship with Park to coerce donations from large companies like Samsung to two non-profit foundations she set up and allegedly used for personal gain.

Advertisement. Scroll to continue reading.

Prosecutors say Park colluded with Choi to extract money from the firms and will question the president as a subject in a criminal investigation.

The scandal has seen Park’s approval ratings plunge to record lows, and hundreds of thousands of protestors have taken to the streets in a series of weekly protests to demand that she resign.

Samsung — South Korea’s biggest business group — donated 20 billion won ($17 million) to Choi’s foundations, making it the largest single contributor.

It is separately accused of offering Choi 2.8 million euros ($3 million) to bankroll her daughter’s equestrian training in Germany, which led prosecutors to raid Samsung Electronics’ offices in Seoul this month.

The group’s advertising unit is also accused of offering a donation to a sports foundation run by Choi’s niece, who is seen as her key aide.

A number of Samsung officials — including Lee — have been questioned by prosecutors over the scandal, which has shed light on unhealthy ties between the government and powerful conglomerates that have endured over decades.

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...