Samsung chairperson resigns after indictment

April 22nd, 2008 - 12:54 pm ICT by admin  

Seoul, April 22 (DPA) Samsung Group chairperson Lee Kun Hee Tuesday announced his resignation, less than a week after he was indicted for tax invasion and breach of trust. Lee, 66, apologised for the distress that the three-month investigation of South Korea’s largest conglomerate had caused and took full responsibility, “both legally and morally”, for the scandal.

“I pledged to make Samsung as a top-class company about 20 years ago, but I’m really sorry for not living up to the promise,” Lee said at a nationally televised news conference.

At the same time, Samsung announced a reform plan that includes dissolving its strategic planning office, which coordinates group operations and is considered the conglomerate’s power centre.

Special prosecutors finished their inquiry into bribery charges against the company by indicting Lee last Thursday while also saying they were unable to prove allegations that Samsung had used multimillion-dollar slush funds to bribe public officials.

Lee, who was among 10 top Samsung executives indicted, was accused of using nearly 1,200 accounts established under other people’s names to carry out profitable stock transactions and avoid 113 billion won ($114.3 million) in taxes.

The breach of trust charge stemmed from accusations that Lee played an important role in the illegal transfer of power at Samsung to his only son, Lee Jae Yong.

He faces five years in prison and a fine if convicted.

Lee Kun Hee and the other indicted Samsung executives were not jailed ahead of their trials because prosecutors said such arrests would cause “enormous disruptions” in the running of Samsung.

The conglomerate includes Samsung Electronics Co, the world’s largest maker of liquid crystal displays and second-largest chipmaker. It is also involved in shipbuilding, construction, financial services and the chemical industry and produces a fifth of the exports from South Korea, the world’s 13th-largest economy.

Lee Kun Hee took over the leadership of Samsung in 1987 from his father, the company’s founder.

He had trouble with the law previously when he was convicted in 1996 for bribing two former presidents. He received a suspended prison term and was granted a presidential pardon in 1997.

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