On January 15th 2008, Samsung’s headquarters and the offices of Kun-Hee Lee, the Group CEO and Chairman, were raided by special court investigators as part of a government approved investigation, with the maintenance of a fraud which was alleged to be used for systemic bribery of government officials. Following the report of the special prosecutor appointed by the President of Korea, Mr. Lee and two more executive directors including his son, resigned from the board in April 2008.

On October 10, 2008, the Seoul High Court found Lee Kun-Hee, Lee Hak-Soo and Kim In-Joo (former inside directors of Samsung Electronics) guilty of tax evasion and sentenced them to prison terms of between 3-5 years, fines and community service. However, the court acquitted the three directors form the charge of breach of duty charges. The special prosecutor in charge of the case sought appeal to the Supreme Court, on the basis that the misappropriation in the process for Samsung Everland’s issuance of convertible bonds and Samsung SDS’ issuance of bonds with warrants had been satisfied. In May 29, 2009, the Supreme Court acquitted Lee Kun-Hee, Lee Hak-Soo and Kim In-Joo of the breach of duty charges, reiterating judgement by the Seoul High Court.