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Friday 26 May 2017

South Korean investigators seek arrest of Samsung heir again

Special prosecutors have asked a court to issue an arrest warrant for Lee Jae-yong (AP)
Special prosecutors have asked a court to issue an arrest warrant for Lee Jae-yong (AP)

South Korean prosecutors are attempting for a second time to arrest Samsung's de facto leader, who faces bribery allegations in connection with a massive political scandal.

Special prosecutors investigating the influence-peddling scandal that led to the impeachment of the president said they have asked a court to issue an arrest warrant for Lee Jae-yong, vice chairman of Samsung Electronics.

They also are seeking an arrest warrant for Samsung Electronics president Park Sang-jin, who oversees the company's external relations.

Seoul Central District Court said it will hold a hearing on Thursday to review the arrest request.

This is the second attempt by prosecutors to arrest Lee, heir to the Samsung Group. Last month, a court said there was not enough evidence to justify his arrest.

The prosecutors said the 48-year-old billionaire offered a bribe of 36 million dollars (£29 million) to President Park Geun-hye and her long-time friend to win government backing for a controversial merger.

The merger of Samsung C&T and Cheil Industries in 2015 was opposed by minority shareholders, who said it would benefit the Samsung founding family while hurting other shareholders.

Samsung narrowly secured shareholder approval, thanks in part to support from the National Pension Fund, its key investor.

The pension fund's current chief was arrested last year on suspicion of pressuring the fund to back the merger, which helped Lee increase his influence in Samsung Electronics without spending any of his money.

Lee admitted Samsung transferred funds to a company and foundations controlled by Choi Soon-sil, President Park's secretive friend, but denied allegations that he expected to win any government favours.

The court's rejection last month of the arrest request dealt a blow to the prosecutors, who have until February 28 to investigate unless parliament extends the deadline.

Prosecutors said the Samsung heir faces new charges in addition to bribery, embezzlement and lying under oath. They did not elaborate.

South Korean media reports said the prosecutors are looking at whether Samsung purchased a costly horse for Choi's daughter, who is an equestrian, an allegation Samsung has denied.

The investigators are also reportedly looking at whether South Korea's fair trade commission gave any favours to Samsung related to a complex cross shareholding structure that allows the Lee family to exert a disproportionate influence on Samsung Electronics and its dozens of affiliates, while holding a small stake.

The anti-trust regulator was raided earlier this month by prosecutors.

AP

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