Samsung chief Lee Jae-yong set up the BVI shell company for a Swiss bank account

Oct. 14, 2021, 02:46 PM.

Starting on October 4, 2021, KCIJ-Newstapa reports the findings of the project “The Pandora Papers: Koreans who Fled to Tax Havens 2021.” It is a collaborative project led by the International Consortium of Investigative Journalists(ICIJ) which was joined by more than 600 journalists from all over the world. This global team of journalists has been investigating over 11.9 million documents leaked from 14 offshore service providers, including Trident Trust, Alcogal and IL SHIN CPA and IL SHIN Corporate Consulting.    
– Editor’s Note -
It is confirmed that Lee Jae-yong, vice chairman of Samsung Electronics, set up a shell company in an offshore tax haven to open a corporate account at a Swiss bank, UBS.
Earlier, Newstapa has reported that Lee established a shell company called Bachury Finance Corp. in the British Virgin Islands in 2008.   
Trident Trust, one of the world’s largest offshore service providers, helped Lee with Bachurfy Finance’s incorporation process. The documents related to Lee’s shell company came from client files leaked from this offshore service provider.    
Newstapa’s further examination on various correspondences between the Trident Trust’s offices in Switzerland and BVI revealed why Lee had set up the shell company. 
In a document with the subject “New Client Information” sent from an employee of Trident Trust’s Swiss branch to its BVI branch in May 2008, Lee Jae-yong is specified as the beneficial owner of Bachury Finance. The document states that the purpose of the company was “to hold an account with UBS, Zurich.”
▲According to this correspondence between Trident Trust's Swiss office and BVI office, the beneficial owner of Bachury Finance is Lee Jae-yong and the purpose of the shell company is "to hold an account with UBS, Zurich."  
The document also includes a name who is assumed to be Lee Jae-yong’s asset manager - Adrian Ludi. Newstapa was able to find out that Ludi was responsible for Korean and Japanese clients at UBS Wealth Management at that time. When we looked up the mailing address written on the correspondence, it matched the UBS headquarters located at the heart of Zurich’s financial district, Paradeplats.
A copy of Lee Jae-yong’s passport was attached in another correspondence from the previous day sent on April 30. A stamp mark on it read that a background check had been conducted by UBS Wealth Management prior to sending the fax.    
It was Adrian Ludi, asset manager at UBS Wealth Management who sent the copy of Lee’s passport to Trident Trust. And a man named Ernst Schuler, who certified the copy of Lee’s passport was authentic, was identified as then the head of UBS Wealth Management.   
Based on these internal documents of Trident Trust, it is assumed that UBS provided consulting service to Lee Jae-yong on personal asset management, and recommended him to create a shell company in the British Virgin Island and open a bank account under its name managed by UBS Wealth Management.    
▲Based on the leaked internal documents of Trident Trust, UBS first provided consulting service to Lee Jae-yong on personal asset management. It can be assumed that they then recommended him to set up a BVI company to open a corporate account managed by UBS Wealth Management.
▲트라이덴트 트러스트 내부 연락 문서 내용을 종합하면 먼저 UBS가 이재용 부회장에게 개인 자산 운용과 관련한 컨설팅을 했고, 그 결과 BVI에 페이퍼컴퍼니를 만들어 해당 법인 명의로 UBS자산운용이 관리하는 계좌를 개설하라고 제안한 것으로 추정된다.
In line with this, it seemed UBS commissioned Trident Trust’s Swiss office to make up a BVI-based company for Lee to finally establish Bachury Finance between March and May 2008. It took place during the special prosecutors’ crackdown on the Samsung group and its chairman Lee Kun-hee’s alleged slush funds. The probe had been triggered by the disclosure of Kim Yong-chul, a former chief lawyer for Samsung. 
Adrian Ludi, who had been in charge of UBS Wealth Management for Korean and Japanese clients when Lee set up a BVI company in 2008, worked at the Ultra High Net Service of USB Wealth Management until April 2015. Since then, he has been working at LGT Bank in Singapore, another private banking service provider headquartered in Liechtenstein.    
Newstapa had contacted Ludi several times via phone and email to ask why Lee Jae-yong opened an account at UBS as well as the size of Lee’s assets that he used to manage for Lee. We have received no response from Ludi.
Clients of UBS Wealth Management are divided into two groups: Ultra-High Net Worth clients who are required to deposit at least USD 50 million and High Net Worth clients with at least USD 2 million.
ReportingKim Ji-yoon, Kim Yong-jin, Hong Woo-ram, Kang Hye-in, Lee Myung-ju
Video reportingShin Young-chul, Jeong Hyeong-min
Video editingPark Seo-Young, Yoon Seok-min
CGJung Dong-woo
DesignLee Do-hyun
DataChoi Yun-won, Kim Kang-min
Web Publishing Heo Hyeon-jae