April 22, 2008 / 3:47 AM / 11 years ago

TIMELINE: Key events related to Samsung Group probe

(Reuters) - The head of the giant Samsung Group, Lee Kun-hee, announced on Tuesday he would step down from the post following his indictment last week for tax evasion and breach of trust.

Following are key events related to the investigation:

- November 5, 2007: A former head of Samsung Group’s legal division, Kim Yong-cheol, accuses the conglomerate of operating a slush fund to bribe prosecutors, politicians and bureaucrats to quash investigations into the company’s murky management structure. Samsung said the accusations were not true.

- November 20: South Korea’s financial watchdog Financial Supervisory Service says it has started a probe into Kim’s allegation that Samsung used so-called “borrowed name accounts”, or accounts used by the company but set up in the names of trusted employees, to stash secret funds.

- November 23: South Korea’s parliament approves an independent counsel investigate the allegations made by Kim Yong-cheol.

- November 26: Kim says Samsung had used its subsidiaries to help create a 200 billion won ($202.2 million) slush fund.

State prosecutors start investigation. In the first week, they ban Samsung Group officials from traveling abroad in order to face possible questioning, raid Samsung’s brokerage unit, Samsung Securities (016360.KS) and a data centre at Samsung SDS, the group’s integrated IT services unit.

- December 12: South Korea’s financial watchdog says Woori Bank and brokerage Goodmorning Shinhan Securities had broken rules in setting up accounts for Samsung Group, giving credibility to Kim’s claim of “borrowed name accounts”.

- January 10, 2008: The parliament-approved special counsel begins its investigation. In its first week, it raids an office of Samsung leader Lee Kun-hee, the homes of seven other executives, Samsung’s Seoul headquarters and Lee’s residence.

- February 14: The special prosecutor counsel raids the headquarters of group flagship Samsung Electronics (005930.KS).

- February 28: The special prosecutor counsel questions Chairman Lee Kun-hee’s son, Lee Jae-yong.

- April 2: Lee Kun-hee’s wife questioned on allegations she tapped into slush fund to buy artwork.

- April 4: Group chief Lee questioned by special prosecutor.

- April 17: Special prosecutor indicts Lee Kun-hee for tax evasion and breach of trust. Clears Lee of bribery charges. Prosecutor also indicts nine other top executives for helping to hide 4.5 trillion won ($4.53 billion) in Lee’s assets and working secretly to transfer Lee’s wealth to his children.

- April 22: Lee Kun-hee says to step down as group head.

Reporting by Rhee So-eui, editing by Jon Herskovitz and Keiron Henderson

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