Samsung Electronics’ Lee Jae-yong granted special pardon by South Korea

The billionaire was twice sent to prison but had been out on parole since last year, but the special pardon ends a five-year ban on Lee holding a formal position at Samsung. The company’s shares were up 1% in Seoul on the news.

“I will work harder and fulfill my duties as an entrepreneur,” Lee said after his pardon was granted. “I will contribute to the economy through continuous investment and job creation for young people, and repay the expectations of the people and the government’s consideration.”

Lee has been operating as Samsung’s de facto leader since 2014, when his father fell into coma after suffering a heart attack. The senior Lee died in 2020.

His pardon comes ahead of the country’s Liberation Day which marks the liberation of Korea from Japanese imperial rule in 1945. The South Korean government often grants pardons around Liberation Day.

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Lee, also known widely as Jay Y. Lee, had been sentenced to five years in prison for embezzlement and bribery in August 2017, but he walked free after less than a year in 2018 when an appeals court threw out some of the charges and suspended the sentence.

However, Lee was sent back to prison in January 2021 after being sentenced to two and a half years without a suspension after the Seoul High Court found him guilty of embezzlement and bribery. He was released on parole on Liberation Day last August.

Along with Lee, Lotte Group’s Chairman Shin Dong-bin and two other business leaders were included in the group pardoned or reinstated by President Yoon Suk Yeol.

South Korea’s Justice Minister Han Dong-hoon on Friday said, “To overcome the economic crisis by revitalizing the economy, Samsung’s Vice Chairman Lee Jae-yong, who’s term has recently ended, will be reinstated.”

Despite an uncertain economic environment exacerbated by long-running supply chain issues and the war in Ukraine, Samsung has outlined some bold investments plans this year. In May, the South Korean conglomerate said it would pour more than $350 billion into its businesses and create tens of thousands of new jobs over the next five years, most of which would be in South Korea.

No employment restrictions for Lee

The pardon paves the way for Lee to work without restrictions.

According to South Korean law, if a person is convicted of embezzlement or breach of trust worth more than 500 million Korean won ($384,101), that person cannot work for a company related to the crime for five years even after the prison sentence ends. Reinstatement will lift the employment restrictions on Lee.

However, his legal troubles may not be over.

He faces a separate trial over a controversial 2015 merger that helped him tighten control over the company. Eleven executives from Samsung, including Lee, were indicted in 2020 on charges including illegal transactions, stock manipulation, and perjury.

That case is still pending.