A South Korean court denied an arrest warrant request for Samsung Group heir apparent Jay Y. Lee, saying that although prosecutors secured "a considerable amount of evidence," it was still not enough to detain Lee. Prosecutors filed for the warrant last week, accusing Lee of accounting fraud and stock manipulation.
Prosecutors allege that the value of electronics materials provider Cheil Industries was artificially inflated before its 2015 merger with Samsung C&T, Samsung’s de facto holding company, to create a more favorable rate for Lee, who was then the largest shareholder in Cheil.
Lee served nearly a year in jail between 2017 and 2018 after he was charged with bribing former President Park Geun-hye to secure support for the merger. The scandal eventually led to Park’s impeachment in 2017 and a 25-year prison term for bribery, abuse of power and embezzlement.
According to Nikkei Asian Review, Seoul Central District Court said in a statement, "It appears that prosecutors have secured a considerable amount of evidence through their investigation, but they fell short of explaining the validity to detain Lee."
Prosecutors said the investigation would continue and they may apply again for an arrest warrant, or bring Lee to trial without an arrest. Lee’s attorneys said they want the case to be reviewed by an outside panel to decide if an indictment is justified.
In a statement emailed to TechCrunch, a Samsung spokesperson said, "Samsung denies that Mr. Lee ordered or was involved in any illegal activities, including allegations of illegal transactions and stock manipulation. A 2015 merger of two Samsung affiliates followed related rules and regulations. Accounting changes at Samsung Biologics also complied with international accounting standards and regulations."