Prostitution scandal in Korea: will Samsung chairman get away with it again?

Photo: Korean Culture and Information Service/Wikimedia Commons

By Sarah Caroline Bell

It came as a shock, but not as a surprise. The bedridden 74-year-old Lee Kun Hee, Samsung Group Chairman and 2016 Forbes Korea Rich lister, has for years been utilising the services of prostitutes, which is illegal in South Korea.

On 21 July, local news site NewsTapa released a video clip which clearly shows Lee negotiating with several sex workers – footage taken between 2011 and 2013. It is hardly a surprise to South Koreans that someone of such a position could be regularly engaging in an illegal and immoral activity. Companies such as Samsung, conglomerates known as chaebols, have long been criticised for acting as though they are above the law.

It appears, though, that they really are.

A long history of evading punishment

Although Lee Kun Hee has in the past been found guilty of multiple criminal acts, he has never been appropriately punished in proportion to his offending. Rather, he has been continuously pardoned on account of who he is and, of course, his wealth. In 1997, Lee was found guilty of bribing former presidents, handed a suspended two year prison sentence, and subsequently pardoned by then President Kim Young Sam.

He was pardoned again in 2009 by President Lee Myung-bak, after being found guilty of embezzlement and criminal tax evasion. Lee Kun Hee’s pardon was based on him being instrumental in assisting the government with their 2018 Winter Olympics bid to hold the event in Pyeongchang, which they eventually won. The pardoning of Lee Kun Hee was extensively criticised by the public as just another example of members of the chaebol families getting away with whatever they please.

Controversy has surrounded him ever since.

In 2010, Samsung’s former chief legal counsel released a behind the scenes look at the company, in a book titled Think Samsung. The book made the claim that Samsung is the most corrupt company in Asia. Whether true or not, it isn’t hard to imagine that when looking at the track record of Lee Kun Gee.

Samsung: a sudden donation

The day before the news of the scandal broke in the media, the South Korean Ministry of Justice announced that Lee Kun Hee’s wife and their son, Lee Jae Yong, the heir to Samsung, donated a total of 4 billion won (US$ 3.5 million) to a charity that would build a Youth Education Service Center, aimed at helping underprivileged young women get ahead in life.

The donation was interestingly timed. It is usually underprivileged young women who turn to prostitution for income. Samsung, in their official formal statement, confirmed they had received threats of blackmail in relation to the video, pointing to the fact that they must have known about the existence of these videos for some time.

In all his past criminal cases, Lee Kun Hee used his contribution to the South Korean economy as a means to avoid punishment. Samsung, however, was clearly on the offensive in this case, eager to get in a fresh new example to point to of Samsung doing good for women from poorer backgrounds.

Prostitution is illegal in Korea and both parties engaging in illegal activities, and well as those who provide a premises for illegal operations. In Lee Kun Hee’s case, two premises were used. One premises being his own family residence, the other a location rented under the name of a former Samsung group executive.

How much did Samsung know? Did the staff member whose name was on the rental contract know his or her name was being used in this manner, or was this person’s name used as an alias, without their consent?

Lee, who has been bedridden since a heart attack in 2014, must surely have had staff members assisting him with the organisation of his meetings, for in some cases there were up to five sex workers present at a time, commanding a per visit rate of 5 million won each (US$ 4,440).

In South Korea, those found guilty of providing or accessing the services of a prostitute are subject to either a three year jail sentence or a fine of up to 30 million won (US$ 26,644), which is not much at all for a member of the rich list.

Thirty million won is a paltry sum in comparison to the 4 billion won donation already made this month. Paying over 133 times the basic penalty for the crime, Samsung has cleverly bought Lee Kun Hee an escape route; a way to look like he is the head of a company that is actively committed to doing good in South Korean society.

We won’t be seeing him serve a jail term any time soon.