South Korean prosecutors are seeking a five-year jail term for Samsung chair Lee Jae-yong over charges of accounting fraud and stock manipulation connected to the controversial 2015 merger of two of the group’s units.
Prosecutors allege that Lee, who was vice-chair of Samsung Electronics in 2015, was among a group of executives that inflated the stock price of Cheil Industries, a textile company, and devalued Samsung C&T, a construction and engineering business, during the merger to help cement the billionaire scion’s control of the conglomerate.
They claim that Lee’s alleged stock manipulation inflicted losses on shareholders of Samsung C&T. Lee, the grandson of Samsung founder Lee Byung-chul, is also accused of orchestrating a $3.9bn accounting fraud at the group’s biopharmaceutical unit in 2015 as part of the same case.