2016 just keeps on getting worse for the electronic giant Samsung. As if the financial and brand ramifications of the S7 fire issues were not enough to damage Samsung enough, it has been caught again in a controversy related to the troubled South Korean President Park Geun-hye.
Ms. Park has been in the middle of a huge controversy as her close confidante for decades, Ms. Choi Soon-Sil was charged with numerous abuses of her power that ranged coercion to fund her non-profit organizations and fraud. Ms. Park was alleged for providing help to Ms. Choi in her criminal offenses.
Ms. Choi has been President Park since she was inaugurated at South Korea’s most powerful position and has used her ‘connections” with Park to amass a considerable amount of wealth along with unyielding power that have also been allegedly utilized to coerce large companies in South Korea to pay millions of dollars to her in the shape of “Funds & Donations”.
The company which is facing the heat at the moment in the midst of this controversy, Samsung, has agreed that it did provide money to two of the foundations owned by Ms. Choi that amounted to $17.46 million and another financial transaction showed that it provided money to Ms. Choi’s daughter to buy a horse named Vitani V. The cost of the horse was expected to be around $850,000.
Samsung’s head Lee Jae-Yong admitted before a counsel to being at fault by providing money to the foundations which led it to become part of the huge controversy.
Although admitting to giving off the money, Lee denied that the money was given in expectation of favors from the Government through “influential” channels.
Some other South Korean Companies are also in the midst of the same controversy along with Samsung as lawmakers take charge of a hearing into the corruption scandal.
The hearing was being aired on television, in a rare incident for such sensitive cases, which would further undermine the Samsung Brand. The panel cannot punish any of the companies in any way but they can render their public apologies on the forum, the leading lawmaker added.
The South Korean Parliament will go into a vote for impeachment this Friday to decide President Park’s fate.