InterDigital Inc (IDCC)

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SEOUL, South Korea (AP) -- Special prosecutors raided the headquarters of Samsung Group on Tuesday in a widening probe into allegations the massive conglomerate set up a slush fund to bribe influential figures.
The raid, which occurred in the same building where global technology giant Samsung Electronics, the flagship of the conglomerate, has its Seoul offices, came a day after investigators searched an office of Samsung Chairman Lee Kun-hee and seven other locations.
As the raid was occurring, Samsung Electronics said net profit in the fourth quarter fell 6.6 percent from a year ago amid sharp declines in prices for computer memory chips. That was a smaller drop than expected, and investors -- apparently unfazed by news of the raid -- sent the company's stock as much as 3 percent higher.
Yim Jun-seok, a Samsung spokesman, confirmed that investigators entered the strategic planning office at the conglomerate's headquarters in Seoul. He provided no details. Investigators could not immediately be reached for comment.
Yonhap news agency, quoting sources involved in the raid, reported that dozens of prosecutors and investigators seized documents and other materials related to the allegations in Tuesday's raid.
The probe, which started last week, came after Kim Yong-chul, a former top legal affairs official at Samsung, alleged that the conglomerate set up a 200 billion won ($215 million, 144 million euros) slush fund to bribe influential figures such as prosecutors, judges and government officials.
Kim, a former prosecutor himself, alleged that Samsung used Samsung Corp. -- the conglomerate's trading arm -- to create the pool of money through intricate contracts with other group affiliates and that Lee's family members used some money to buy expensive art work.
Samsung, a conglomerate spanning dozens of companies with interests ranging from construction to shipbuilding, has denied the allegations.
Huge South Korean industrial groups such as Samsung are not new to scandals. The so-called chaebol conglomerates have regularly been accused of wielding their economic might to influence government decisions and of using dubious dealings between subsidiaries to help controlling families evade taxes and transfer wealth to heirs.
Lee's tenure has also been marked by controversy as Samsung has been the focus of previous investigations. Lee was convicted in 1996, along with seven other leading South Korean business executives, of giving and arranging bribes to ex-South Korean President Roh Tae-woo, a former general. Lee was handed a two-year suspended prison term, meaning he did not serve time in jail.
South Korea's National Assembly in November passed legislation authorizing an independent counsel investigation into the matter, which was reluctantly approved by President Roh Moo-hyun.
Separately, Samsung Electronics said it earned 2.212 trillion won ($2.36 billion; 1.59 billion euros), in the three months through December, down 6.6 percent from a year ago.
While the company took a hit in lower prices on memory chips, it reported record overall sales for the quarter as well as its largest ever three-month sales figure for mobile phones.
Samsung Electronics is the world's largest manufacturer of computer memory chips, and plays a leading global role in a range of electronics products including flat screen televisions. It ranks No. 2 in mobile phones behind Finland's' Nokia Corp.
In another milestone, the company racked up consolidated sales in 2007 of 96.1 trillion won ($102.5 billion; 68.9 billion euros), marking the first time the figure has ever exceeded $100 billion, said Chu Woo-sik, executive vice president for investor relations.
Samsung's share price 2.5 percent to 538,000 won ($574; 386 euros) in early afternoon trading.

http://edition.cnn.com/2008/BUSINESS/01/14/samsung.probe.ap/index.html?iref=topnews