Samsung Chairman to Step Down

Wednesday, April 23, 2008

's most powerful businessman said he is stepping down after 20 years at the helm of the Samsung group, following his indictment for tax evasion and breach of trust.


A sombre Lee Kun-Hee made the shock announcement at a press conference called to announce reforms to the scandal-tainted group, which employs 200,000 people and accounted for more than 20 percent of the nation's exports last year.

Special prosecutors charged Lee last Thursday following a three-month investigation into corruption allegations against the multinational. They cleared him of bribery and said he would remain free pending trial.

In a statement Samsung said four other executives, including vice chairman Lee Hak-Soo, would step down by the end of June. The chairman's resignation is effective immediately.

Samsung said it would scrap its powerful strategic planning office, a group of some 90 officials accused of helping the chairman manage his hidden assets and illicitly transfer control of management to his son Lee Jae-Yong.

Jae-Yong would quit as chief customer officer of Samsung Electronics, the group flagship, and work on developing emerging markets.

Apart from the chairman it indicted nine other Samsung executives including the vice chairman.

The investigators said they had discovered 4.5 trillion won (4.6 billion dollars) of Lee Kun-Hee's hidden assets in bank and stock accounts opened under the names of executives.

They said Lee evaded taxes worth 112.8 billion won but there was no evidence the group had created a slush fund to bribe government officials, as the ex-lawyer claimed.

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