Will Samsung Case Mark A Turning Point For South Korean Business Ties To Government? : Parallels After Lee Jae-yong's conviction for bribery, "I hope this is a starting point to cutting off businesses' close relationship to the government," said South Korean President Moon Jae-in's spokesman.
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Will Samsung Case Mark A Turning Point For South Korean Business Ties To Government?

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Will Samsung Case Mark A Turning Point For South Korean Business Ties To Government?

Will Samsung Case Mark A Turning Point For South Korean Business Ties To Government?

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ROBERT SIEGEL, HOST:

A South Korean court has sentenced the de facto leader of Samsung to five years in prison on corruption charges. It's part of a bribery scandal that brought down the president of South Korea this spring. As NPR's Elise Hu reports, what happens now could affect the direction of the country.

ELISE HU, BYLINE: Samsung's leader, Jae Y. Lee, stood silently when he learned his fate inside a Seoul courtroom. Outside, his supporters didn't hold back.

UNIDENTIFIED WOMAN: (Shouting in Korean).

HU: Eight-hundred riot police surrounded the courthouse to help control the crowds of demonstrators angry with the guilty verdict. Choi Tae-son was one of them.

CHOI TAE-SON: The guilty means if he's guilty, then she's guilty.

HU: She is ousted President Park Geun-hye, who lost her job in a sprawling public corruption scandal linked to Lee. The court today convicted Lee on charges that Samsung paid millions in bribes to slush funds for President Park all in exchange for government approval for a controversial merger. It helped cement family rule of the company, as Lee is the son of the chairman and grandson of the founder.

PARK SANGIN: That is the reason he's well-known and his importance in Korean society is so big.

HU: Seoul National University economist Park Sangin says this conviction will have serious symbolic meaning in South Korea.

PARK: This is kind of the moment we have to change fundamentally for us to go further.

HU: Lee maintains his innocence, and his attorneys say he will appeal. But who leads Samsung matters because the company played such a key role in the nation's emergence as an economic powerhouse. Today, South Korea is called the Republic of Samsung for a reason. The company is known globally for its electronics and smartphones.

(SOUNDBITE OF ARCHIVED RECORDING)

UNIDENTIFIED MAN: The phone that defined big just got bigger.

HU: In Korea, the Samsung conglomerate is biggest. It encompasses more than 50 affiliates involved in life insurance, shipping, cars, construction, hospitals, hotels and even seeing-eye dogs. Author Geoffrey Cain, who wrote a forthcoming book on Samsung, put it this way.

GEOFFREY CAIN: You can live your entire life here from cradle to the grave on Samsung products. So you can, you know, go to the Samsung morgue when you're dead. You can get married at the Samsung wedding hall in the company.

HU: As the country's leading chaebol, the Korean term for family-run superconglomerate, Samsung found itself inextricably tied to state power centers. After this giant scandal, Koreans are asking, should chaebol be so centrally powerful, aligned with government and led by dynasties? The economist Park...

PARK: There will be more argument and more momentum built up for the reform of Korean chaebol.

HU: The new South Korean president seems to agree. His spokesman said after the verdict, I hope this is a starting point to cutting off businesses' close relationship to the government that has held our society back from going forward. Elise Hu, NPR News, Seoul.

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