Stories

Samsung heir found guilty of bribery, embezzlement

AP

Samsung Electronics vice chairman Jay Y. Lee was found guilty of bribery, embezzlement and perjury by a South Korean Court, slapping him with a five year prison sentence, according to local news reports. Lee is expected to appeal the verdict.

South Korea's special prosecutor's office accused Lee of bribing a friend of former President Park Geun-hye in exchange for government favors, allegedly including approval of a 2015 merger between Samsung C&T and Cheil Industries. That deal consolidated the Lee family's power over Samsung Electronics, according to CNBC.

Why it matters: The jail sentence won't have much impact on the global day-to-day operations of Samsung because Lee is not the face of the flagship brand, but it creates some uncertainty about long-term management. The case renews criticism about the close relationship between South Korea's large, family-run conglomerates (called chaebols) and the country's government.