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(EDITORIAL from Korea Times on June 29)

All News 06:55 June 29, 2020

To indict or not
What will prosecution do over Samsung heir?

The prosecution is in a dilemma over whether to bring criminal charges against Samsung Group heir Lee Jae-yong after an independent panel recommended against his indictment Friday. This has put the law enforcement agency under pressure to prove Lee's alleged involvement in a controversial merger of two Samsung affiliates and in accounting fraud at Samsung Biologics.

Lee's lawyers welcomed the recommendation from the 14-member committee of outside experts that the prosecution drop the investigation and not indict him. More than half the members argued that it was difficult to substantiate Lee's alleged violation of the capital market law during the 2015 merger between Samsung C&T and Cheil Industries.

The panel accepted Lee's claims that he was not involved in any illegalities in gaining greater control of Samsung Group, Korea's largest conglomerate, through the merger or the alleged accounting fraud at the group's pharmaceutical affiliate Samsung Biologics. At the center of the allegations against Lee is a succession plan to take over managerial rights from his father Lee Kun-hee, who has been incapacitated since a heart attack in 2014.

The prosecution failed to convince committee members that Lee had been deeply involved in illegalities to push for his succession. In this regard, the recommendation has dealt a setback to the prosecution's efforts against Lee. The prosecution already suffered a setback on June 9, when a Seoul district court rejected its request for an arrest warrant for him.

The prosecution is now expected to decide its course of action according to the investigation results and the committee's advice. Whatever decision it makes, the agency cannot avoid criticism. If it drops the charges against Samsung Electronics Vice Chairman Lee, the prosecution will be lambasted for overlooking his alleged wrongdoings and undermining the rule of law. If it indicts him, it could be blamed for abusing its investigative power despite deteriorating economic conditions amid the COVID-19 pandemic.

The prosecution, along with the judiciary, has long been too lenient toward family-run chaebol in what have been rampant illegal practices such as tax evasion, creating slush funds, accounting fraud and the illicit transfer of managerial control from parents to their children.

Lee is still standing trial for his alleged involvement in a massive corruption case surrounding former President Park Geun-hye. The Supreme Court sent his case back to the Seoul High Court for a rehearing after reversing the appeals court's ruling that sentenced Lee to 30 months in prison suspended for four years. Lee may face heavier punishment because the top court recognized additional bribes provided by Samsung to Park's confidant Choi Soon-sil.

Apart from the bribery case, Lee and Samsung are desperate to avoid any indictment related to the merger and alleged accounting fraud. That is why he turned to the independent committee to try to get a favorable decision. Yet, the prosecution has no obligation to follow the non-binding recommendation, although it has accepted all decisions the panel made in eight previous cases since its inception in 2018.

It remains to be seen whether the prosecution will honor or reject the advice on the Lee case. The agency should make a fair and wise decision based on facts and evidence.

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