Last updated: December 29, 2009 7:59 pm

South Korea pardons ex-Samsung chairman

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South Korea on Tuesday granted a presidential pardon to Lee Kun-hee, the former Samsung chairman convicted of tax evasion and breach of trust, in an attempt to boost the country’s chances of hosting the 2018 Winter Olympics.

“This [pardon] decision was made so that Lee could take back his place at the IOC [International Olympic Committee] and form a better situation for the 2018 Olympics to take place in Pyeongchang,” said Lee Kwi-nam, justice minister.

The government has been battling to gain support for the mountain town of Pyeongchang, which already lost narrowly to Vancouver for 2010 and the Russian resort of Sochi for 2014.

Seoul’s hosting of the 1988 summer Games marked the country’s emergence as a modern, industrialised state.

Supporters of the pardon for Mr Lee, the country’s most recognisable businessman, cited his role in transforming a once-poor agrarian nation into the world’s 11th largest economy.

Mr Lee, 67, resigned as chairman of South Korea’s largest industrial group in April 2008. Although he was cleared of bribery allegations, he was given a three-year suspended jail sentence in August for his role in selling bonds of a Samsung unit to his children at below-market prices. He stepped aside from his IOC duties amid the charges.

The amnesty appeared to conflict with President Lee Myung-bak’s calls this month to strengthen the rule of law and toughen scrutiny of corruption cases involving business leaders.

“Mr Lee could make marginal contributions to the country’s bid for the Olympics as the hosting of these international events is often affected by well-known figures’ human networks. But his presence cannot be a deciding factor,” said Kim Sang-jo, head of Solidarity for Economic Reform, a group which campaigned against the amnesty.

“His international activities at this point could give the wrong impression to foreigners about the rule of law in this country.”

Mr Lee, who has been an IOC member since 1996, is seen by business and sports groups as a well connected lobbyist for Pyeongchang in its competition against Munich and the French town of Annecy for the 2018 Games. It is not clear, however, whether the IOC ethics commission will allow him to resume active membership before the IOC vote in 2011.

Two other South Korean IOC members were convicted on domestic criminal charges in recent years. Park Yong-sung, chairman of the rival Doosan Group, was pardoned for embezzlement and other charges in 2007, but the ethics board nevertheless subsequently suspended his right to sit on any IOC commission for five years. Kim Un-yong, who was IOC vice-president, resigned in 2005 after the ethics board recommended his expulsion on conviction for embezzlement and corruption.

”The IOC as a whole has been surprised by how many legal prosecutions have been pursued against IOC members in South Korea,” said Michael Payne, a former marketing director at the IOC. “While it’s too early to say what kind of effect Mr Lee’s pardon would have on South Korea’s bid for the Olympics, the move certainly won’t hurt the country’s [2018] chances. Given that the IOC is a club of individuals, if one of their friends are back in action, it certainly won’t be seen as a negative .

“The worst case is neutral, the best case is positive,” he said.

Additional reporting by Pan Kwan Yuk in London and Zach Coleman in Hong Kong

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