Samsung Electronics Offices Raided Amid Claims Company Sabotaged Labor Union Activities

Samsung Electronics offices in South Korea were raided by prosecutors Thursday morning on charges that the company attempted to sabotage labor union activities.

The Investor reports that the unit is being accused of taking part in the attempt spearheaded by Samsung Group. The raid comes about a week after the arrest of Choi Pyeong-seok, the executive of Samsung Electronics Service who is in charge of the human resources division of the company.

Choi was taken into custody by the Seoul Central District Court because he is suspected of leading the orchestration of the scheme to disrupt labor union activities among Samsung employees. Authorities were informed that Choi allegedly instructed subcontractors to prevent the establishment of the workers’ labor union and its activities.

Choi is also being investigated for allegedly profiling workers who engaged in labor union activities and for offering cash incentives to members who drop out of the union.

Additionally, prosecutors have launched an investigation into Samsung Securities Co. officials who may have been involved in the massive dividend error last month that jolted the local financial market, Korea Herald has learned.

The blunder that happened on April 6 pertained to the accidental issuance of around 113 trillion won (US$104 billion) worth of stocks after an official made an error of typing 1,000 shares instead of 1,000 won per share in dividends paid to employees under the company’s compensation plan.

The mistake caused Samsung to issue 2.8 billion shares that only existed on paper. What’s worse is that some workers who received their shares quickly sold them in the market. Authorities are now investigating 21 officials in relation to the blunder which is now being referred to as the “fat-finger” case.

On the same day that prosecutors raided Samsung’s offices and launched its investigation on the “fat finger” case, the company’s move to expand its recruitment of IT experts in the United States was publicized.

Industry sources told South Korean outlet Yonhap that Samsung is now looking to penetrate deeper into emerging business areas, so it is luring IT experts from rival firms in the U.S. The move is also part of Samsung’s efforts to establish new growth engines, like artificial intelligence, and bolster its overall competitiveness in cutting-edge areas.