South Korean president OK's Samsung probe

Last Updated: Tuesday, November 27, 2007 | 1:04 PM ET

CBC News

President Roh Moo Hyun of South Korea on Tuesday agreed to an independent probe of Samsung Group on accusations that he and members of his government may have been bribed by the company.

The country's legislature on Friday passed a bill seeking an independent investigation into the allegations, which include suggestions by a former top legal affairs official that Samsung operated a $215-million US slush fund to bribe influential figures. Opposition party members have also accused Roh of receiving Samsung money before and after his election in 2002.

South Korean President Roh Moo Hyun has been accused by opposition party members of accepting bribe money from Samsung Group.
(Canadian Press)

"I decided to accept the bill" as a majority of the legislature voted for it, Roh said in a televised news conference on Tuesday. Roh had threatened to veto the bill and also criticized the National Assembly for passing it, saying it had legal and political problems.

"I decided not to veto it because people want to know the truth of the Samsung allegations."

Samsung has denied the claims and is considering legal action against Kim Yong-chul, the former official who said the company operated the slush fund. Kim, who was one of the company's top lawyers from 1997 to 2004, said Samsung had created the pool of money through intricate contracts with its affiliates, and that family members of chairman Lee Kun-hee used $65 million U.S. of the money to buy expensive artwork.

He also said Samsung manipulated evidence and witnesses in a court case over a purported deal to transfer control of the company from the chairman to his son, Jae Yong.

In 2005, two Samsung executives were given suspended jail terms after being convicted of illegally handling the father-to-son transfer. But neither Lee nor his son faced any criminal charges.

The bill passed on Friday mandates that special counsel will investigate charges that Lee masterminded illegal transactions to help transfer control of the company to his son.

Samsung Group, which counts shipbuilding and construction among its varied businesses, is South Korea's largest conglomerate. Its Samsung Electronics arm is one of the world's largest electronics makers.

With files from The Associated Press

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