Seoul
CNN
—
Samsung chief Lee Jae-yong was discovered not responsible by a Seoul courtroom on Monday on expenses of inventory manipulation and accounting fraud linked to a controversial merger in 2015 of two Samsung associates.
The acquittal comes as a serious reduction to the chairman of Samsung Electronics, who has been embroiled in authorized issues for years.
Final 12 months, South Korean prosecutors had requested for a five-year jail time period for Lee, alleging that he and different executives inflated the inventory value of a textile firm, Cheil Industries, and devalued a development and engineering firm, Samsung C&T.
They alleged that the merger of the 2 corporations allowed Lee to realize a tighter grip on Samsung Electronics, the group’s flagship firm.
Lee’s attorneys had denied any wrongdoing, saying the merger had helped the administration of the conglomerate grew to become extra steady.
Seoul Central District Court docket chief choose Park Jeong-je mentioned there was not sufficient proof that Samsung had supposed to trigger losses to Samsung C&T and its shareholders by means of the merger.
“Even when Lee’s management has been strengthened, the merger on this case can’t be thought of unfair, so long as there’s a cheap function for the merger,” Park mentioned.
It’s unclear if prosecutors will enchantment this ruling, which has come as a shock to consultants.
“It’s a completely stunning verdict,” Park Sangin, economics professor at Seoul Nationwide College, advised CNN. He added the choice will “result in decreasing the arrogance of international traders within the Korean authorized system and the soundness of the Korean capital market.”