Samsung to disband lobby team: vice chairman - The Korea Times
The Korea Times

Settings

ⓕ font-size

  • -2
  • -1
  • 0
  • +1
  • +2

Samsung to disband lobby team: vice chairman

Samsung Electronics Vice Chairman Lee Jae-yong answers a question during a parliamentary probe into a scandal engulfing President Park Geun-hye at the National Assembly in Seoul, Tuesday. / Yonhap
Samsung Electronics Vice Chairman Lee Jae-yong answers a question during a parliamentary probe into a scandal engulfing President Park Geun-hye at the National Assembly in Seoul, Tuesday. / Yonhap

Some tycoons support abolition of chaebol lobby group

By Kim Tae-gyu


Samsung Electronics Vice Chairman Lee Jae-yong said he would disband the corporate strategy office, the powerful control tower of Samsung Group, in a National Assembly hearing, Tuesday.

The core strategic unit is believed to be at the center of the problematic support for President Park Geun-hye's shadowy confidant Choi Soon-sil and the controversial merger of two Samsung affiliates ― Samsung C&T and Cheil Industries ― last year.

"After hearing many lawmakers scold the corporate strategy office, I learned there are many suspicions and negative opinions. If the general public and other lawmakers have the same view, I will scrap it," Lee said.

"I am very cautious because the office was set up by my grandfather founding Chairman Lee Byung-chul, and has been maintained by my father Chairman Lee Kun-hee. But I will do away with it if there are so many negative opinions."

But Lee dismissed all suspicions with regard to the influence-peddling scandal involving President Park and Choi. In particular, the Samsung Group heir negated the allegations that the chaebol got favors in the merger between Samsung C&T and Cheil in return for donating more than 20 billion won to the Mir and K-Sports foundations related to Choi.

Last year, the National Pension Service (NPS), which owned an 11.6 percent share in Samsung C&T and a 5 percent share in Cheil, agreed with the deal in spite of expected losses.

Doubts sprang up that Samsung got special treatment via the merger, which is believed to have helped Lee's grip on the nation's biggest conglomerate. But the vice chairman, the sole son of bedridden Chairman Lee, rebuffed them.

"The merger was not related to my succession," Lee said. "It was only intended for the best interest of the associated companies."

Cheong Wa Dae also denied the allegations that a presidential secretary made a former NPS chief investment officer support Samsung's merger, which was opposed by many offshore investors.

Asked when he was made aware of Choi, Lee said he could not remember. However, he regretted a lack of transparency in buying a horse valued around 1 billion won for Choi's daughter Chung Yoo-ra, a professional dressage competitor.

He added that during their two meetings President Park Geun-hye did not overtly ask for donations for the foundations and Samsung has never wired funds in exchange for any specific favors.

"I am embarrassed to be embroiled in the scandal," he said. "We should have been a better example as a Korean company."

Of note is that Lee also pledged not to work with the Federation of Korean Industries (FKI), which came under fire for urging conglomerates to donate approximately 77 billion won for the establishment of the two private foundations.

He also said Samsung would not pay membership fees to the FKI that was forged by his grandfather in the early 1960s in time with a military coup by former President Park Chung-hee, father of the incumbent President.

It would be a big blow to the already-embattled FKI as Samsung is the biggest contributor to its annual budget.

SK Group Chairman Chey Tae-won and CJ Group Chairman Sohn Kyung-shik also agreed with the idea of breaking up the country's biggest business lobby group.

Five other tycoons who were present at the parliamentary hearing were against the idea. LG Group Chairman Koo Bon-moo countered that the FKI should stay afloat as a friendly society for large-sized companies just like a heritage foundation.

Although lawmakers bombarded the Samsung vice chairman with a variety of questions, other business leaders including Hyundai Motor Group Chairman Chung Mong-koo also got queries.

Against the accusation that the nation's top carmaker gave special favors to an advertising company run by Cha Eun-taek, who is close to Choi, Chung claimed he couldn't remember.

"Because of the high volume of our advertising amounts, I cannot remember everything in detail," he added.

SK Group Chairman Chey said the group donated 11.1 billion won to the two foundations with no strings attached, thus contradicting rumors the money was for a special pardon for Chey.

After spending two-and-a-half years in prison for misappropriating company funds, Chey got a special presidential pardon last year.

K-Sports requested SK Group offer an additional 8 billion won to nurture fencing and tennis but the proposal was refused. Chey said the group made the decision because the demand was inappropriate and not detailed.

Lotte Group Chairman Shin Dong-bin said former Vice Chairman Lee In-won decided to provide 7 billion won to the K-Sports Foundation. The former executive committed suicide in August amid corruption investigations of the group.

Asked whether Lotte made the donation to regain its duty free shop license after losing it late last year, Shin replied, "I don't think so."

Lotte provided 6.2 billion won to the two foundations last year and gave 7 billion more to K-Sports this year, which was returned a day before the prosecution raided its offices in June.

Other tycoons from GS, Hanwha and Hanjin groups also said President Park did not openly request donations and they did not offer them in order to get something in return.

Samsung Electronics Vice Chairman Lee Jae-yong answers a question during a parliamentary probe into a scandal engulfing President Park Geun-hye at the National Assembly in Seoul, Tuesday. / Yonhap
Samsung Electronics Vice Chairman Lee Jae-yong answers a question during a parliamentary probe into a scandal engulfing President Park Geun-hye at the National Assembly in Seoul, Tuesday. / Yonhap

Some tycoons support abolition of chaebol lobby group

By Kim Tae-gyu


Samsung Electronics Vice Chairman Lee Jae-yong said he would disband the corporate strategy office, the powerful control tower of Samsung Group, in a National Assembly hearing, Tuesday.

The core strategic unit is believed to be at the center of the problematic support for President Park Geun-hye's shadowy confidant Choi Soon-sil and the controversial merger of two Samsung affiliates ― Samsung C&T and Cheil Industries ― last year.

"After hearing many lawmakers scold the corporate strategy office, I learned there are many suspicions and negative opinions. If the general public and other lawmakers have the same view, I will scrap it," Lee said.

"I am very cautious because the office was set up by my grandfather founding Chairman Lee Byung-chul, and has been maintained by my father Chairman Lee Kun-hee. But I will do away with it if there are so many negative opinions."

But Lee dismissed all suspicions with regard to the influence-peddling scandal involving President Park and Choi. In particular, the Samsung Group heir negated the allegations that the chaebol got favors in the merger between Samsung C&T and Cheil in return for donating more than 20 billion won to the Mir and K-Sports foundations related to Choi.

Last year, the National Pension Service (NPS), which owned an 11.6 percent share in Samsung C&T and a 5 percent share in Cheil, agreed with the deal in spite of expected losses.

Doubts sprang up that Samsung got special treatment via the merger, which is believed to have helped Lee's grip on the nation's biggest conglomerate. But the vice chairman, the sole son of bedridden Chairman Lee, rebuffed them.

"The merger was not related to my succession," Lee said. "It was only intended for the best interest of the associated companies."

Cheong Wa Dae also denied the allegations that a presidential secretary made a former NPS chief investment officer support Samsung's merger, which was opposed by many offshore investors.

Asked when he was made aware of Choi, Lee said he could not remember. However, he regretted a lack of transparency in buying a horse valued around 1 billion won for Choi's daughter Chung Yoo-ra, a professional dressage competitor.

He added that during their two meetings President Park Geun-hye did not overtly ask for donations for the foundations and Samsung has never wired funds in exchange for any specific favors.

"I am embarrassed to be embroiled in the scandal," he said. "We should have been a better example as a Korean company."

Of note is that Lee also pledged not to work with the Federation of Korean Industries (FKI), which came under fire for urging conglomerates to donate approximately 77 billion won for the establishment of the two private foundations.

He also said Samsung would not pay membership fees to the FKI that was forged by his grandfather in the early 1960s in time with a military coup by former President Park Chung-hee, father of the incumbent President.

It would be a big blow to the already-embattled FKI as Samsung is the biggest contributor to its annual budget.

SK Group Chairman Chey Tae-won and CJ Group Chairman Sohn Kyung-shik also agreed with the idea of breaking up the country's biggest business lobby group.

Five other tycoons who were present at the parliamentary hearing were against the idea. LG Group Chairman Koo Bon-moo countered that the FKI should stay afloat as a friendly society for large-sized companies just like a heritage foundation.

Although lawmakers bombarded the Samsung vice chairman with a variety of questions, other business leaders including Hyundai Motor Group Chairman Chung Mong-koo also got queries.

Against the accusation that the nation's top carmaker gave special favors to an advertising company run by Cha Eun-taek, who is close to Choi, Chung claimed he couldn't remember.

"Because of the high volume of our advertising amounts, I cannot remember everything in detail," he added.

SK Group Chairman Chey said the group donated 11.1 billion won to the two foundations with no strings attached, thus contradicting rumors the money was for a special pardon for Chey.

After spending two-and-a-half years in prison for misappropriating company funds, Chey got a special presidential pardon last year.

K-Sports requested SK Group offer an additional 8 billion won to nurture fencing and tennis but the proposal was refused. Chey said the group made the decision because the demand was inappropriate and not detailed.

Lotte Group Chairman Shin Dong-bin said former Vice Chairman Lee In-won decided to provide 7 billion won to the K-Sports Foundation. The former executive committed suicide in August amid corruption investigations of the group.

Asked whether Lotte made the donation to regain its duty free shop license after losing it late last year, Shin replied, "I don't think so."

Lotte provided 6.2 billion won to the two foundations last year and gave 7 billion more to K-Sports this year, which was returned a day before the prosecution raided its offices in June.

Other tycoons from GS, Hanwha and Hanjin groups also said President Park did not openly request donations and they did not offer them in order to get something in return.


dailyenglish
kolect

X
CLOSE

Top 10 Stories

go top LETTER

The Korea Times

Sign up for eNewsletter