Samsung Is Under Scrutiny Again as South Korean Police Raid Offices


But the legal troubles of the family behind Samsung have renewed concerns in South Korea about the fate of the conglomerate, a major economic force in the country. The scrutiny also reflects public frustration with years of criminal charges leveled against the leaders of Samsung and some other big family-run companies that have led to light sentences and even to official pardons.

Lawmakers have also turned up the pressure. This week, Park Yong-jin, a member of South Korea’s governing Democratic Party and a vocal critic of the country’s corporate culture, dragged one of Lee Kun-hee’s two earlier convictions back into the limelight when he said that financial authorities had allowed Lee Jae-yong to inherit billions of dollars from his father without paying taxes.

South Korea would have reaped about $2 billion from the transaction, “if tax authorities had followed the rules and levied inheritance taxes,” Mr. Park said.

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The criticism put the spotlight on one of Samsung’s most embarrassing episodes.

In 2008, prosecutors found 4.5 trillion South Korean won, or roughly $4.5 billion at the time, in assets that belonged to Lee Kun-hee but were divided up in more than 1,000 accounts under his lieutenants’ names. Prosecutors alleged that Lee Kun-hee had inherited the money from his father, Lee Byung-chul, Samsung’s founder, and that it had been structured to avoid taxes.

Lee Kun-hee was convicted in 2008, but South Korea’s president at the time, Lee Myung-bak, pardoned him the following year. It was the second time Lee Kun-hee had been given a presidential reprieve: He was also pardoned in 1997, a year after a conviction on bribery charges.

In a statement on Wednesday, Samsung said, without specifying amounts, that Mr. Lee had paid all the taxes that he promised to reimburse in 2008.

“The principle remains completely unchanged that the money will be used for a good cause,” the statement said.

Lee Kun-hee, 75, has been incapacitated since a heart attack in 2014. Many South Koreans still express admiration for the industrialist because of his transformation of Samsung from a local manufacturer of cheap goods into a global behemoth.

Samsung CT, one of the conglomerate’s biggest units, has a portfolio including major power plants and suspension bridges, as well as the Burj Khalifa in Dubai, the world’s tallest building.


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Lee Kun-hee reportedly owns the five most expensive houses in Seoul, the South Korean capital, all valued at more than $10 million. His main residence in the area of Itaewon, a coveted address occupied by ambassadors and the country’s wealthiest families, is worth around $20 million, according to official city data.

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