Special Prosecutors Raid National Pension Service for Evidence of Samsung Merger Bribery

Special Prosecutors Raid National Pension Service for Evidence of Samsung Merger Bribery

SEOUL, Dec. 21 (Yonhap) -- Special prosecutors raided the state-run pension service Wednesday to investigate whether its approval of Samsung Group's merger of two affiliates last year was influenced by President Park Geun-hye and her confidante.

   The team led by independent counsel Park Young-soo officially began its investigation into an influence-peddling scandal involving Park after 20 days of preparation.

   The investigators visited around 10 places, including the investment management office of the National Pension Service (NPS), and the health and welfare ministry's pension department, which oversees the pension fund.

   They secured computer hard drives and documents related to the NPS' decision to approve the controversial merger between Samsung C&T and Cheil Industries in July 2015.

   Samsung is alleged to have received the support from the nation's largest institutional investor in exchange for its donations and favors to Park's long-time friend Choi Soon-sil and her daughter.

   Samsung allegedly donated 20.4 billion won to the two public foundations virtually controlled by Choi. An opposition lawmaker also claimed that Samsung signed a 22 billion-won (US$18.4 million) contract with a German-based company owned by Choi and financially supported her daughter Chung Yoo-ra's purchase of equestrian horses, training and other costs.

   Critics said the Samsung's amalgamation of the two units was intended to enhance heir-apparent Lee Jae-yong's control of the group, despite possible damage to shareholders. His father, Lee Kun-hee, has been hospitalized since May 2014 after suffering a heart attack.

   The NPS, a major shareholder of the two Samsung companies, held a decisive vote for the merger. The NPS' backing has drawn criticism as its decision was not reviewed by an independent panel, which advises the state fund in exercising voting rights for invested firms.

   "I will make efforts to carry out a fair and balanced investigation in accordance with the law and principle," independent counsel Park Young-soo said during a ceremony to officially launch the investigation.

   The investigation should be completed within 70 days and can be extended for another month upon request from the independent counsel.

   The team will especially focus on allegations that Park pressured conglomerates to fund the two foundations: Mir and K-Sports.

   The independent counsel also started its investigation into Choi's daughter Chung currently presumed to be staying in Germany.

   The team said it has secured a court warrant to detain Chung for questioning on charges of business obstruction. It requested the German prosecution's cooperation for her repatriation and will take steps to invalidate her passport, the team said.

   Lee Kyung-jae, attorney for Choi and her daughter, expressed regret over the counsel's plan to arrest her without a summons being delivered to the suspect.

   The team will also look into allegations surrounding the whereabouts of Park on April 16, 2014, when the ferry Sewol sunk, claiming more than 300 lives.

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