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SEOUL, SOUTH KOREA - Lee Kun-hee, president of the Samsung Group, has resigned after assuming the legal and moral responsibility for the company’s tax and corruption scandals. The 66-year old executive made the decision after accusations of tax evasion and breach of trust related to investigations during the last months.
Executives of Samsung, the largest South Korean commercial group, have been accused of keeping secret accounts to bribe politicians and government members.
Lee, who has controlled Samsung; South Korea's largest business conglomerate, for 20 years, announced the decision on a nationwide news conference.
"Today, I decided to retire as chairman of Samsung. I would like to express my deepest apologies for causing great concerns to the public as a result of the special probe." Lee said.
According to the prosecutors, Lee allegedly traded Samsung shares with $4.5 billion in hidden accounts, while evading about $114 million dollars in taxes.
Prosecutors have said that Lee will go on trial without incarceration, calling the irregularities a "time-honored practice" by Korean conglomerates.
The prosecutors also said that Lee played a role in the illegal transfer of Samsung control to his son, which occurred in the mid-1990s, when his son acquired convertible bonds from Samsung subsidiary Everland, and took over control of the company by buying stocks at "a remarkably low price."
While allegations are still unproven, the son of the Samsung president and heir Lee Jae-Yonf also announced resignation from his post of account director of Samsung Electronic Company.
Following Lee's resignation, shares of Samsung closed sharply down by 9%, while shares of Samsung Securities fell 4.78%.
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