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Samsung Offices Raided as Political Scandal Grows

By November 9, 2016 at 2:51 pm
South Korean President Park Geun-Hye (Photo : Chung Sung-Jun | Getty Images News)

Samsung Electronics is dealing with yet another huge scandal after the South Korean firm recalled its exploding Galaxy Note 7 smartphones in September and faulty washing machines in October. According to local media, South Korean prosecutors searched the offices of Samsung on Tuesday as part of an investigation about the political scandal involving President Park's long-time friend, Choi Soon-sil, who has allegedly exerted improper influence in state affairs.

President Park has faced public outcry over the scandal, with tens of thousands of South Korean protesters demanding her resignation in Seoul over the weekend. Investigators are still looking into whether Choi used her relationship with Park to influence major political decisions and to force companies to donate funds to two of her non-profit foundations for her personal gain. Park has recently granted lawmakers the power to choose her new prime minister in an attempt to defuse the situation.

The South Korean tech giant is suspected of secretly funding the sporting activities of Choi's daughter. Samsung allegedly transferred $3.1m into a company that Choi owned in Germany. The funds were allegedly used to pay for Choi's daughter's training as a dressage rider.

Investigators will summon Samsung executives for questioning to determine whether they made deals to resolve any business issues with Park in return for the donations.

Samsung refused to comment since the investigation is still ongoing.

The recent Samsung raid is not actually the first time in history. The tech giant was also searched in 2008 due to allegations that Samsung created slush funds to bribe government officials.

"Samsung has become an embarrassment to Korea, where saving face is still a factor in reputation management," stated Jonathan Bernstein, a crisis management expert. "Samsung's board of directors has to firmly take charge of the company's direction now in order to reassure both internal and external stakeholders."

The raid on Samsung's offices could potentially spur a backlash against the company.

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