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Samsung vice chairman Lee Jae-yong is going back to prison, casting the future of leadership at the massive tech company in doubt.
The Seoul High Court in South Korea sentenced Lee to 2 1/2 years behind bars on Monday after finding him guilty of embezzlement and bribery. He was taken into custody following the verdict.
It’s the latest twist in a controversy that has followed Samsung for years. Lee, also known as Jay Y. Lee, was caught up in a massive influence-peddling scandal that brought down the government of former South Korean President Park Geun-hye. Park herself is spending some two decades in prison in connection with the case.
Lee, meanwhile, was found guilty of bribery and other corruption charges in 2017, and sentenced to five years in prison at the time. But he walked free after less than a year when an appeals court threw out some of the charges and suspended his sentence.
This latest sentence is the result of a retrial ordered by the country’s Supreme Court.
Lee’s return to prison comes at a critical time for Samsung. His father Lee Kun-hee, the company’s chairman, died last year. The elder Lee had been comatose since suffering a heart attack in 2014 but remained titular chairman of the company. His son had been operating as Samsung’s de facto leader.
Samsung declined to comment about the sentencing, instead referring to a statement from Lee’s attorneys.
“This case is, in essence, a violation of corporation’s rights to freedom and property by the former president abusing her power,” said Injae Lee, the lawyer leading the vice chairman’s defense team. “I find the court’s decision regrettable.”
The company’s shares dove in Seoul following the announcement, though. Samsung
(SSNLF) stock fell nearly 3.8%.
Lee can appeal if he so chooses, though it was not immediately clear whether he intends to do so.
Lee’s legal troubles also aren’t over yet. 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 last year on charges including illegal transactions, stock manipulation, and perjury.
