When power changes hands at the helm of some of the world’s biggest companies, most people don’t notice. If the products work, the services run, and the store shelves are full, then who sits in the boardroom doesn’t make the news. But when it comes to Samsung, the family dynasty behind it is so complex and the company so important to South Korea’s economy that everything ends up on the front pages. That’s what happened in 2017, when Samsung’s heir apparent, Lee Jae-yong, also known as JY Lee, was jailed for his role in a corruption scandal that also brought down the country’s president.
The 57-year-old is the grandson of Samsung founder Geoffrey Cain, who has described him as “one of the most powerful people in the history of technology.” But in 2015, with his father, the Samsung chairman, in the hospital after a heart attack, Lee’s legacy was uncertain.
He was accused of giving money to foundations run by Choi Soon-sil, a close friend of former South Korean President Park Geun-hye, in exchange for political support for a merger that would have strengthened his control over the conglomerate. He was also accused of stock fraud and accounting manipulation in that merger between Samsung C&T and Cheil Industries. Prosecutors said he did so to gain control of most of the new entity and, in doing so, secure control of Samsung Electronics, the empire’s “crown jewel.”
Lee Jae-yong has always denied the fraud allegations, but was found guilty of corruption in 2017. When the scandal broke in 2016, it sparked mass protests in Seoul and led to the impeachment of the country’s president.
WHY WAS THIS AGREEMENT SO IMPORTANT?
Since its founding as a grocery store in the late 1930s, Samsung has been in the hands of the Lee family. According to Cain, the family is “the equivalent of royalty” in South Korea. It has transformed the business into a global powerhouse, encompassing insurance, memory chips, construction and consumer technology. But to remain in family hands, the conglomerate has undergone complex mergers and transfers of power, maneuvers that eventually landed Lee in prison.
He had taken over de facto control in 2014, when his father suffered a heart attack. But the process of securing full family control was not yet complete. The empire had become extremely complex, dozens of companies linked to each other through a complex web of shares. Another problem was the inheritance tax, over $10 billion. If the family were to sell shares to pay it, it risked losing control.
INHERITANCE RISK
As the only son, Lee was the choice to lead Samsung. But not everyone was convinced of his abilities. Journalist Jaeyeon Lee says he was seen as more reserved and cautious than his father. Some thought his sister was more capable and criticized him for being too harsh. Doubts about his abilities also arose when his e-Samsung project failed during the dotcom bust. The family had previously experienced a difficult succession, when his father, Lee Kun-hee, was elected instead of his older brothers.
EMPTY CHAIR
After a shaky start, Lee Kun-hee led a period of success in the 1980s and 1990s. But in 2008, he and his son resigned amid allegations of slush funds for bribes. Although he was later acquitted of corruption, he was convicted of tax evasion. That left a void at the top of the company and raised questions about the future of Samsung and the country’s economy. In 2012, Lee Kun-hee’s older brother took legal action to claim what he believed was his inheritance. A process that threatened to derail the succession plan.
The conflict had long roots, dating back to the division of the empire in 1976. A decision that had consequences for decades. The courts ruled that it was too late to take legal action, ending the conflict. This helped establish a clear line of succession. So when Lee Kun-hee was bedridden after a heart attack, it was clear who would take over: his son.
Apology
Only in July 2025 was Lee Jae-yong finally acquitted by the Seoul High Court of fraud charges related to the merger agreement. This ended a decade of trials and imprisonment for the Samsung leader. He also signaled a major departure from the tradition of “chaebol” (Korean family businesses): “I want to promise now, there will be no more succession disputes. I will not pass the right to lead to my children.” This raises a new question: if the eldest son does not automatically inherit the empire, who will lead Samsung in the future?