Joonyoung Jeong
The’Compliance Surveillance Committee’ was highlighted in the reconciliation review for Samsung Electronics Vice Chairman Lee Jae-yong. This committee was proposed by Deputy Judge Jung Joon-young (presiding judge), who read the judgment on behalf of the three chief judges of the Criminal Division 1 of the Seoul High Court at the court on the 18th.
“There is no way to monitor the control tower”
Deputy Judge Jeong suggested a “effective compliance system” to Vice Chairman Lee, referring to the case of the late Samsung Electronics Chairman Lee Kun-hee’s’Samsung Shin Shin-young’ in the first trial of the revocation review held on October 25, 2019. It was intended that a system was needed to monitor corporate executives and employees, including the general manager, to comply with relevant laws in their job performance. He also explained that in the United States, if the compliance system is effectively operated in accordance with Chapter 8 of the federal sentencing standard, punishment will be lowered.
Samsung created the Samsung Compliance Committee in January of last year, and former Justice Kim Ji-hyung served as the chairman of the Compliance Committee. Judge Jung also said at a trial on the 17th of that month that “Samsung’s compliance monitoring system is the core content of the corporate criminal sentencing standards.”
Then, Special Prosecutor Park Young-soo objected and filed a request to evade the court, and the trial was postponed until October last year. After the trial resumed, Judge Chung selected a professional judge to judge the effectiveness of the Samsung Compliance and Compliance Committee, and former Constitutional Court judge Kang Il-won was appointed as the expert judge. At the recommendation of Vice Chairman Lee, attorney Kim Gyeong-su (former chief of the heavy prosecutor) joined the professional hearing committee. The evaluation results of these three people became a situation that had a decisive influence.
The evaluation report was released on December 14 last year despite requests from professional judges that time is tight. Judge Kang gave a neutral opinion that the top management’s willingness to comply and monitoring of public opinion are important. Attorney Kim diagnosed that the compliance committee had high will and enthusiasm. On the other hand, accountant Hong assessed that the Compliance Committee was not operating effectively and had limitations. Each report was not agreed on the effectiveness of the Compliance Committee.
In the decision trial held on December 30 last year, Vice Chairman Lee said, “What kind of role Samsung should play in our society, how to develop a compliance culture, and what kind of entrepreneur Lee Jae-yong should become? I threw it.”
After reviewing the reports of professional judges and Vice Chairman Lee’s remarks, Judge Chung positively appreciated Vice Chairman Lee’s sincerity and efforts to improve the effectiveness of the compliance system.
However, as a result, it was judged that “it is difficult for the new system to meet the criteria for effectiveness.” He pointed out that the Samsung Compliance System is not coming to the fore to prevent and monitor new types of risks that may arise in the future. In addition, it is believed that there is no specific compliance monitoring plan for the organization acting as a control tower in the Samsung Group, and the risk of the false service contract method used to bribe the political power in the past remains.
Reporter Lee Ga-young [email protected]