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South Korean prosecutors look to arrest head of Samsung in influence scandal

Following 15 hours of questioning the executive on Monday, a South Korean special prosecutor's office is once again seeking an arrest warrant for the head of the Samsung Group —Jay Y. Lee —in an influence-peddling scandal threatening to topple the country's President, Park Geun-hye.




The office is also filing for a warrant to arrest Samsung president Park Sang-jin, Reuters reported on Tuesday. Both executives are potentially facing charges of bribery, embezzlement, and concealing assets overseas, while Lee would be targeted with an additional perjury charge, new since the first failed attempt at securing an arrest.

More details are due to be announced in a briefing on Wednesday. A hearing on the warrants is scheduled for Thursday.

"Samsung has absolutely never bribed the president seeking something in return or sought illicit favors," Samsung said in an official statement.

The company is accused of spending $37.31 million on a business and various organizations backed by Choi Soon-sil, a close friend of Korean President Park Geun-hye, in exchange for her support in the merger of two Samsung affiliates. This even includes sponsoring the equestrian career of Choi's daughter, who was eventually arrested in Denmark after being sought by Korean officials.

Park is still technically in office, but parliament voted to impeach her in December, specifically for her allegedly colluding with Choi to pressure businesses into donating to foundations supporting Park's initiatives. If the country's Constitutional Court upholds the impeachment, Park will be forced from office —a first for any elected Korean leader.

Lee is officially the vice chairman of Samsung Electronics, the division that competes with Apple through products like the Galaxy S7 smartphone. Practically speaking, however, he has been in charge of the Samsung Group since his father's 2014 heart attack.

His arrest would be disruptive to Samsung Group as a whole, but likely not to Samsung Electronics except for any long-term strategies. Products such as the Galaxy S8 and Galaxy Note 8 are already in the pipeline, and the company can probably continue designing and releasing phones without Lee's help.

Despite their rivalries, Apple is dependent on Samsung for parts. The former is said to have signed a $4.3 billion deal for 5-inch OLED screens, expected to appear in an "iPhone 8" or "iPhone X" shipping later this year. It's not clear whether the device will have a 5.1, 5.2, or 5.8-inch screen.