South Korean authorities seek arrest of Samsung head Lee Jae-yong (Update)

Samsung’s troubles with the Note 7 this past summer may soon pale in comparison to its most recent crisis.

On Monday morning, prosecutors in South Korea asked a court to grant them an arrest warrant for Lee Jae-yong, the vice chairman of Samsung Electronics and heir apparent to the entire Samsung business empire. Lee stands accused of embezzlement and bribery charges related to the ongoing scandal involving South Korea’s impeached president, Park Geun-hye.

“We can’t accept the prosecutor’s argument that we made illegal requests associated with the merger and management succession”

Lee and company allegedly paid out more than $36 million USD in bribes to Choi Soon-sil, a controversial close confidant of the disgraced president, in an effort to secure the government’s support for a merger between two Samsung subsidiaries, Cheil Industries Inc. and Samsung C&T Corp.

Lee is the son of current Samsung chairman Lee Kun-kee. The elder Lee was hospitalized in 2014 after suffering a heart attack, and while it’s assumed Jae-yong is the head of Samsung in all but name, South Korean business tradition dictates he can’t officially take on his father’s title until the latter passes away. Should Lee Jae-yong get arrested, a court will decide on Wednesday whether to grant prosecutors the arrest warrant, it will likely send Samsung, as well as Korea, into shock.

Samsung has since denied the claim, stating, “We can’t accept the prosecutor’s argument that we made illegal requests associated with the merger and management succession.”

Update 2017/1/18: A South Korean court has rejected prosecutors request for an arrest warrant for Lee Jae-yong, reports CNBC.

More to come…

[source]Bloomberg[/source]