Lee says sorry as trial starts in Seoul
The former head of South Korea's biggest business group Samsung went on trial yesterday for tax evasion and breach of trust, less than two months after stepping down in the wake of a corruption probe.
"I feel sorry," Lee Kun-hee told reporters before his appearance in a Seoul district court alongside seven co-defendants.
Protesters displayed placards reading "The law is equal for everyone!" and "Let's go to jail, Kun-hee."
Special prosecutors on April 17 charged Lee after a three-month probe into corruption allegations against the multinational. He quit the group later that month after 20 years at the helm.
Prosecutors cleared Lee of bribery, the main claim made by a former Samsung chief lawyer turned whistleblower who had prompted parliament to call for the inquiry.
Lee, 66, could technically face life in prison if convicted. But most other South Korean tycoons brought to court on criminal charges have escaped severe punishment, with judges citing a negative impact on the economy.
The key point at issue in the trial is whether Lee had instigated and planned the controversial transfer of control over the group from him to his son Lee Jae-yong.
Previous court rulings found that executives arranged for the son to acquire control of Everland, Samsung's de facto holding company, at a below-market price in the mid-1990s through the issue of low-priced convertible bonds.
Lee senior was charged with breach of trust over the transfer, with prosecutors citing the "remarkably low price" set for the bonds.
Lee's lawyers say there was no conspiracy when the junior Lee acquired Everland and the son was the only person wishing to acquire the bonds.
Lee Kun-hee is also charged with evading a capital gains tax bill of 112.8 billion won ($110 million).
The special prosecutors found that 1,199 borrowed-name accounts were used to make profits from the sale of shares in Samsung Electronics and other affiliates, and that 112.8 billion won worth of taxes was evaded.
They also said Lee's hidden assets amount to 4.5 trillion won but added that no evidence of a bribery slush fund, as claimed by the whistleblower, had emerged.
Lee also stood trial in 1995 when he was charged with bribing ex-president Roh Tae-woo. He received a suspended jail sentence but was pardoned in 1997.
The court is expected to deliver its verdict in mid-July after holding hearings twice a week.
AFP
(China Daily 06/13/2008 page16)
