SEOUL — The heir to the Samsung empire and four other top executives were indicted Tuesday on multiple charges including bribery and embezzlement, South Korean prosecutors said in the latest blow to the world’s biggest smartphone maker. The presentation of formal charges against Lee Jae-yong and his colleagues makes them almost certain to face trial, casting new uncertainty over South Korea’s biggest business group as it seeks to recover from a humiliating recall. As well as charges of bribery, embezzlement and hiding assets overseas, Lee is accused of perjury, said the spokesman for prosecutors probing a corruption and power abuse scandal that has seen President Park Geun-hye impeached. Three of the five men — but not Lee, the vice chairman of flagship subsidiary Samsung Electronics — resigned their positions, the conglomerate said. The group said it was “dismantling” its Future Strategy Office, the coordinating body that oversees major decisions such as acquisitions or entering new business. The move, described as a “reform plan,” was announced in a brief five-line statement emailed minutes after the indictment.
Under the scheme, each Samsung unit will be allowed to run more independently, a powerful group body handling government lobbying will be disbanded and decisions over donations will be made more transparent, it said. But Chung Sun-Sup, the head of chaebol.com, a private watchdog forum on conglomerates, said: “It is yet to be seen whether this is another cosmetic measure aimed to divert public criticism.”
In the past, he told AFP, “Samsung has dissolved group-controlling organizations when it got caught in breach of laws, only to revive them afterwards under different names.” The Lee family could be “expected to continue wielding power and influence over the whole group, he added, although professionals might get a greater voice in operating each of its subsidiaries.” The corruption scandal centers on Choi Soon-sil, who is accused of using her close ties with President Park to force local firms to “donate” nearly US$70 million to nonprofit foundations, money which Choi allegedly used for personal gain. Samsung was the single biggest donor to the foundations. It is also accused of separately giving millions of euros to Choi to bankroll her daughter’s equestrian training in Germany.