Samsung chief Lee Jae-yong jailed for corruption

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The Seoul Central District Court on Friday sentenced Samsung's de facto head Lee Jae-yong to five years in prison on multiple corruption charges linked to the scandal that saw President Park Geun-hye removed from office, Yonhap News Agency has reported.

The court found Lee guilty of a string of charges including bribery, embezzlement, concealment of criminal proceeds, illegal overseas asset transfer and perjury.

Lee, vice chairman of the Samsung Group, is believed to have been involved in the company's provision of 7.2 billion won (6.38 million US dollars) in bribes for the equestrian training of the daughter of Park's longtime friend and confidante Choi Soon-sil, according to the court.

Samsung Group heir Lee Jae-yong leaves the Seoul Central District Court in Seoul on August 25, 2017. /AFP Photo

Earlier, prosecutors had demanded a 12-year jail term for Lee on charges that he offered or pledged 43.3 billion won to win the government's blessing for a merger between two Samsung subsidiaries under terms designed to increase his control over the entire Samsung empire, reported Yonhap.

Lee, who has been under pre-sentencing detention since February, has denied the charges.

Lee's lawyer, Song Wu-cheol, said on Friday the defense team could not accept the court's decision.

"We are confident the ruling will be overturned," the lawyer said.

Too big to arrest?

Despite the court’s decision, analysts believes Samsung's key businesses will not be affected globally. They point out that it is a consumer-oriented company, with a range of popular products ranging from smartphones to memory chips and display panels supplies to other companies.

Certainly, Samsung appears to have been unaffected by Lee's absence so far, with flagship subsidiary Samsung Electronics announcing record profits recently.

The Samsung Group, made up of 60 interlinked companies, is crucial to the South Korean economy, with sales equivalent to about a fifth of the national GDP.

South Korean protesters hold placards reading "Lee Jae-Yong Out" demanding punishment of the Samsung heir outside the Seoul Central District Court in Seoul on August 25, 2017. /AFP Photo

Lee’s five year-sentence is a landmark for South Korea, where family-run conglomerates, known as chaebols, have long been revered for helping transform the once war-ravaged country into a global economic powerhouse.

Citizens have long demanded government policies to curtail the power of chaebols, which control vast networks of companies through a circular holding structure and with their control typically exceeding cash flow rights. This means families often wield undue influence over group companies in spite of small direct shareholdings.

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