Home Business Business News Samsung Boss Arrested Over Corruption Scandal, Global Impact Yet To Be Calculated

Samsung Boss Arrested Over Corruption Scandal, Global Impact Yet To Be Calculated

Early today, Samsung Group chief Jay Y. Lee was arrested in South Korea, ending speculation over his future. He has been accused in a massive corruption scandal, something which has sent the Korean industry into deep shock. Samsung, which is the world’s manufacturer of smartphones and memory chips, declined to comment, even as the overall impact is still being figured out. Jay Y. Lee is 48 years old and the scion of the country’s richest family.

jay-y-lee-samsung
Jay Y. Lee, who has been arrested over his alleged involvement in the Samsung corruption scandal

Lee, who was taken into custody at the Seoul Detention Centre, had waited the whole night for the authorities to come to a decision. He has been granted no special treatment and is being held in a single cell, which does not even have a TV set or a desk. Lee was a prime accused in the influence-peddling scandal; the scandal ensnared the South Korean president Park Geun-hye, who was impeached. If the constitutional court decides to uphold the impeachment, he will become the country’s first leader to face such a fate. Both Samsung and Lee, however, have denied any wrongdoing. The Samsung Group responded with a single sentence statement; it was not immediately clear if Lee’s bail would be sought. Shares of the Samsung Electronics Co fell sharply today.

This is the same court which had moved any motion to reject Lee last month. However, as more and more evidence of corruption was brought forward, Lee’s arrest became a matter of time. Samsung Electronics president Park Sang-jin, who is a co-accused, has not been arrested as of now. South Korea’s conglomerates are commonly called chaebol, and Samsung is the biggest of all. Lee, incidentally, has been undergoing grooming for the top post at Samsung after his father was incapacitated in 2014 due to a heart attack.

Impact On Samsung

Samsung is said to employs around half a million people, according to The Washington Post. The corruption scandal broke in 2015 when Samsung, allegedly acting upon Lee’s order, paid $36 million in bribes to Choi Soon-sil, an alleged confidant of the now-deposed president Park Geun-hye, to elicit the government’s consent to a merger between two Samsung affiliates.

The arrest comes in the wake of the crisis Samsung faced last year, in major part due to the Galaxy Note 7, which was prone to fires and even explosions, and which led to two recalls of the device. The electronics giant later blamed the battery for the mishap and stated that it was giving extra attention to ensure that a similar fiasco did not happen this year. Samsung is set to launch the Galaxy S8 later this year. The corruption scandal is huge by Korean standards. A total of 43 billion won, approximately $37.74, is said to have been paid to Choi. Later today, Kim Kyoung-soo, a spokesperson of the lDemocratic Party’s presidential frontrunner, said that he hoped that the ruling would banish wrongdoings in the future.

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