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When can a general counsel blow the whistle on his own company? That’s the question raised by a recent case rocking South Korea. Kim Yong-chul, the former top lawyer at Samsung Group, announced in November that he and other company executives had paid bribes to Korean government officials for years. The allegations created a crisis for Samsung and the government, which have both struggled to respond. But many Korean lawyers have already rendered their verdict: Kim shouldn’t have breached his client’s confidentiality. Kim said that Samsung diverted more than $215 million to unofficial accounts while he headed the company’s legal department from 1997 to 2004. At a November press conference in Seoul, Kim said that the funds were used in part to bribe a vast network of politicians and government officials. Participant in bribery Kim didn’t just claim to have uncovered the corruption; he said he actively participated in it, creating and lending his name to many of the slush funds. In a subsequent interview with a major Korean newspaper, Kim admitted, “Of course I have a personal grudge against Samsung.” But he refused to specify his complaints, maintaining that his main purpose was to point out corruption. Reached for comment, an American spokesman for Samsung referred to statements issued by the company’s Korean headquarters which called Kim’s accusations “false, distorted, and exaggerated.” Korean government officials have likewise denied any wrongdoing. A presidentially appointed independent counsel is currently looking into the scandal. Lawyers who become whistleblowers are a virtually unknown species. The United States has yet to see a corporate counsel as senior as Kim come forward to report alleged wrongdoing by his employer. But Korea seemed an even less likely place for it to happen. “Korea is still a very conservative and Confucian society,” said one prominent Seoul-based lawyer who asked to remain anonymous because he knows several people involved in the scandal. “While the general public recognizes the value of whistleblowing by an insider, at the same time such whistleblowing is generally frowned upon. It is believed that such an act is not honorable or decent.” Korean bar backs off The Korean Bar Association appeared to endorse this position when it raised the possibility of sanctioning Kim � not for participating in the alleged corruption, but for violating his client’s confidentiality. The group backed down after withering criticism in the local press. Kim’s motives for coming forward have been the subject of furious discussion among Korean lawyers there and abroad. “Many are questioning Kim’s motives, and there are a lot of rumors flying around, some of which paint an ugly picture,” said W. Eugene Chang, a Tokyo-based partner in the Korea practice of Orrick, Herrington & Sutcliffe. “I do not believe in all these rumors, but Kim does not seem to have many sympathetic supporters.” Several Korean commentators have asked why Kim made his allegations three years after leaving Samsung. That delay is highly significant from an ethical standpoint, said Sukhan Kim, an Akin Gump Strauss Hauer & Feld partner who frequently represents Samsung in the United States. He pointed out that Korean ethical rules � which are based on American guidelines � allow an attorney to breach client confidentiality only to prevent an ongoing or future crime. Sukhan Kim, who was born and raised in South Korea and now works in Akin Gump’s Washington office, noted that nothing Kim allegedly witnessed at Samsung fits that bill. But if his fellow lawyers are largely skeptical, Kim has allies among social justice groups in Korea. He first went public with his allegations at a press conference organized by the Catholic Priests’ Association for Justice, a group that helped bring down the country’s military dictatorship in the 1980s. According to media reports, the lawyer is now living with the association. Some of the Korean lawyers who have criticized Kim acknowledge that his whistleblowing could lead to greater transparency among the nation’s businesses. But they also warn that his disclosures might discourage Korean executives from involving lawyers in their business decisions, or from expanding in-house legal departments that are shockingly small by U.S. standards. Even if Kim’s confession produces reforms that ultimately benefit Korean society, there’s little chance that he’ll be hailed as a hero. The Korean public “might think that what he said was correct and that, if he was correct, that was good,” said Sukhan Kim, “but they will still think he was a rat.”

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