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The Institute for Ethics and Economic
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Opposition lawmaker indicted for
embezzlement in Taiwan. It was reported
that Her Jyh-huei, a Kuomintang legislator was indicted for corruption, embezzlement,
betrayal of trust and money laundering by prosecutors from the Prosecutors’
Office at the Taipei District Court. The indictment accused Her of abusing
his office to borrow loans illegally from banks, or steering illegal profits
to a company in return for payments. (BBC
Monitoring Service 07 May 2004 summary by Sherldine Tomlinson). MOJ gathers
evidence of corruption in Kaohsiung. According to reports, the
Ministry of Justice Investigation Bureau raided six police stations and a number
of video game parlours in Former minister of finance indicted on corruption charges. Prosecutors are pressing for a seven year jail term for Lee Yung-san for his role in an alleged scam regarding a Taitung hotel.Former minister of finance Lee Yung-san was one of 29 people indicted that followed an eight-month investigation into an alleged corruption case. Prosecutors also recommended jail terms of between seven and 12 years for the bank’s former general manager Chen Wen-lin , former deputy general manger Huang Ching-chi and former KMT lawmaker Hung Hsing-rung on charges of profiteering and violating the Company Law. According to the investigation, between 1996 and 1998, Hung peddled his influence as a member of the legislature's Finance Committee to lobby several banks and financial institutions, including the Farmers' Bank of China and the Central Trust of China, to grant loans of around NT$3.4 billion to Hotel Royal Chihpen and construction company Chieh-kuang Co. (The Taipei Times 27 Jun 2003 summary by Sherldine Tomlinson).
INDICTED TAIWAN BUSINESS LEADER RESIGNS Liu Tai-ying, 66, one of Taiwan's most influential businessmen resigned as the head of a major financial group Friday, two weeks after he was charged with 12 crimes, including embezzlement, breach of trust forgery, money laundering and insider trading. While prosecutors have requested he be given a 16 years' imprisonment he denied the charge, arguing that he resigned so that his case wouldn't affect the company's interest. (AP 20 Jun 2003, summary by Hanh Vu).
CAMPAIGN AGAINST CORRUPTION WORKING MINISTRY PROCLAIMS. NT$20,036,500,000 were confiscated; 4,206 people was indicted since Taiwan's fight against money laundering, bribes and vote-buying began in July 1998, according to the latest statistics revealed by ministry of Justice. 233 among the 4,206 indicted were government officials; 353 were legislators, city councilors or county councilors; 874 were mid-ranking government officials; 1,338 were low-ranking government officials and 1,408 were civilians. (Taipei Times, 10 Apr, 2003, summary by Hanh Vu)
fighting money laundering in new campaign. The Investigation Bureau under the Ministry of Justice has stepped up the efforts to fight international money laundering. Liu Shin-tai, director of the bureau’s centre on money laundering, said that the bureau has been enforcing the Money Laundering Prevention Law to fight possible financial and economic crimes in Taiwan. Liu said that the lawmakers ratified in its previous session the latest revisions of the Money Laundering Prevention Law. Liu said that the heightened efforts to fight money laundering along with other nations through international organizations will help effectively prevent terrorist activities in Taiwan. (China Post, March 24, 2003 summary by Sherldine Tomlinson).
DPP WHISTLE-BLOWER MAKES GOOD. DPP legislator Chen Chi-mai, in a clear and simple choice of accountability to his supporters, recently reported a vote-buying scheme for the speakership election of the Kaosiung City Council at the risk of alienating his constituents. Two days before the election, he informed President Chen Shui-bian that the winner of the election would be Chu An-hsiung and that he must not be accepted into the party since he fixed the election through bribery. Chu is accused of buying votes from almost 30 of the 44 city councilors coming from several political parties at NT$5 million per vote. Most of Chen’s 13 fellow DPP city council members were found to have taken bribes from Chu. (Taipei Times, January 27, 2003, summary by Tom Stutsman).
YU SAYS ARREST OF FORMER LAWMAKER A TOP PRIORITY. Premier Yu Shyi-kun stated that the arrest of former independent lawmaker Wu Tzer-yuan is a top priority for law enforcement agencies. Wu was convicted on a number of corruption and fraud charges for his involvement in a 1992 scandal involving the construction of a water pumping station in Taipei County while he was a KMT member and director of the Taiwan Provincial Government’s Planning and Development Department. He was sentenced to jail, but was released soon after due to health conditions. In 1998 he was elected to the Legislative Yuan as an independent legislator and reelected in 2001 despite being convicted on a multitude of charges. On December 29, 2001 he escaped the country to avoid punishment for his corruption convictions. The Taiwan High Court declared him a wanted man on November 19, 2002 and is continuing their search to bring him to justice.(Taipei Times, January 28, 2003, summary by Tom Stutsman).
CHOU BARRED FROM LEAVING. The Supreme Court has rejected the appeal of Chou Po-lun, senior DPP Legislator, after his conviction involving NT$16 million (US $460,000) from a construction company in 1989 in exchange for dropping his opposition to their proposal to build a shopping mall development. Chen Ding-nan, Taiwanese Minister of Justice announced that Chou is barred from exiting country and will commence his six-year prison term commencing in two months. (Taipei Times, January 31, 2003 summary by Tom Stutsman).
KMT WHIP IS CORRUPTION PIT BULL. Outgoing KMT whip, and self professed scandal-buster, Lee Chuan-chia has implicated many prominent politicians in a scandal involving Zanadau Development Corp. Last September, he revealed that Su Hui-chen, the key shareholder of Zanadau corp. paid bribes to DPP politicians to salvage the company’s multi-billion-dollar plan of building a giant shopping mall in Kaohsiung County after she failed to receive loans from China Development Industrial Bank. It was found that at least eight prominent DPP officials accepted bribes of NT$10 million to NT$30 million. Lee singled out Yu Chen, at that time Kaohsiung County commissioner who had served for a time as Zanadau president, as exploiting her public position to increase her own wealth. Lee also recommended that Yu Chen’s son, Interior Minister Yu Cheng-hsien be investigated for his unusually quick approval of licenses for the Zanadau project after succeeding his mother as Kaohshiung County commissioner. Lee also alleged that DPP incumbent Frank Hsieh accepted a NT$4.5 million check from Su Hui-chen while he was a lawmaker, soon after displaying a copy of Su’s bank statement that showed she did indeed wire $4.5 million to Hsieh on Nov. 25, 1994. Hsieh responded to the allegations by saying the payment was for a debt owed to him unrelated to the Zanadau project. Lee also warns that the Zandau scandal is just the tip of the iceberg and that contracts for city mass rapid transit systems will be prone to corruption. (Taipei Times, January 20, 2003, summary by Tom Stutsman).
PROSECUTOR SEEKS JAIL TERMS FOR 15 IN NUCLEAR PLANT SCAM. 12 employees of Taiwan’s state-run China Shipbuilding Corp. and three executives of private companies were indicted yesterday for their role the faulty construction of Taiwan’s fourth nuclear power plant. China Shipbuilding Corp. won the contract to build the base for the nuclear reactor for NT$7.1 billion in May 1998, and then subcontracted the job to Chien Cheng and Huang Chieh, two private companies who used substandard welding materials and paint for the structure. Prosecutors said executives of China Shipbuilding Corp. committed crimes involving corruption, document forgery and fraud; and failing to adequately supervise the subcontractors work. They also committed bid rigging since the subcontractors were not qualified to do the kind of work required for the reactor base. The subcontracted job should have been completed at a cost of NT$4.38 million, but the subcontractors submitted a cost of NT$8.59 million. The prosecutor of the case is seeking jail terms of five, seven, nine and fifteen years for the defendants, who include the China Shipbuilding Corporation’s manager of the machinery plant, two engineers, a management expert, supervisors and foremen, as well as the owner of Chien Cheng, a manager of Huang Chieh, and a construction site director. It has been said the scandal has cost over NT$32.1 million of taxpayers money and that the substandard materials and welding work could have endangered the safety of the nuclear plant and public. (The China Post, January 14, 2003, summary by Tom Stutsman).
FORMER CHAIRMAN OF KMT BUSINESS MANAGEMENT COMMITTEE ACCUSED OF TAKING KICKBACKS Su Hui-chen, former Kaohsiung county councilwoman accused Liu Tai-ying, former chairman of the KMT Business Management Committee and confidant of former President Lee Teng-hui, of involvement in manipulation and stock speculations of KMT-run companies while he served as chairman of the party, together with failed promises in developing a $NT14-20 billion series of shopping and recreational complexes in Kaohsiung county. Liu has denied Su’s allegations that he accepted more than NT$1 billion in kickbacks. The KMT is investigating the large drop in party assets coincidently during the period of 1998 to 2000, when Liu was in office. (Taiwan News, 15th September 2002, summary by Aruna Balakrishnan and Marg Reynolds).
CABINET GETS
TOUGHER ON CORRUPTION. In a bid to eradicate corruption, Taiwan government
has approved a draft amendment to the Statute for the Punishment of
Corruption, which would make those who bribe foreign public servants subject
to fines or jail terms. The bill will be sent to the Legislative Yuan for
further review and final approval. Addressing a press conference Cabinet
affairs meeting, Cabinet spokesman Chuang Suo-hang said that it is important to
amend the statute since neither the Criminal Code nor the statute covers
those bribing foreign government officials. With the amendments to the
statute, Chuang said, the government hopes to improve Taiwan's international
image. To encourage offenders to surrender themselves to authorities,
violators who turn themselves in within one year after the law takes effect
would not be subject to prosecution. Within the first year the law is in
effect, people who made less than NT$50,000 as a result of bribes they paid
will also not face prosecution. (The
Taipei Times, July 11, 2002, summary by Sherldine Tomlinson). MEDIA RAIDED OVER SECURITY. Prosecutors in Taiwan raided Next magazine and seized thousands of copies of its latest issue. The National Security Bureau claimed that the magazine was illegally about to reveal details of the workings of secret government slush funds. Legal action is also taken against China Times, which said that a USDollars 100m extra-legal fund was used for intelligence activities, "practical diplomacy" and secret research projects. Next magazine denounced the search of its offices and the seizures. According to Chen Ding-nan, justice minister, prosecutors had acted within the law. (Financial Times, 21 March, 2002, summary by Pavlidis George). PRESIDENT CHEN REAFFIRMS
COMMITMENT TO CLEAN UP POLITICS. While addressing a graduation ceremony of
the staff training class or the Ministry of Justic Investigation Bureau,
President Chen Shui-bian reiterated his goal to create a clean political environment. He
stated that his administration will do its best to eliminate "black
gold" politics, referring to shady connections linking the government, organized crime and
business groups, which is seen as a deterrent to political democratization
and economic transformation. Part of the strategy is to squash vote-buying in
the forthcoming grassroots elections for township heads and city and county
councils. Chen had also established an anti-black gold action center and a
special investigation task force to scrap corruption and irregularities in
government. ( BBC Monitoring International Reports, January 9, 2002, summary by Eliza
Villarino). SWITZERLAND FREEZES MONEY ALLEGEDLY LINKED TO FRANCE-TAIWAN ARMS DEAL Bernard Bertossa, Geneva’s chief prosecutor, stated 800 million SF ($445 million U.S.) has been frozen in accounts that were channeled from Elf-Aquitaine to another French firm, Thomson-CSF, now called Thales. The funds were to secure a 1991 contract to sell six Lafayette frigates to Taiwan. This week, nearly $33 million was frozen in a Liechtenstein court on the same grounds. (People’s Daily China, July 4, 2001, summary by Marg Reynolds).
TAIPEI: CITY COUNCIL HEAD TAKEN FOR QUESTIONING OVER CORRUPTION CLAIMS. Huang Yu-wen, Tainan City Council Speaker, together with his wife and five other people, including three city government officials, have been detained for questioning for their alleged involvement in manipulating city council to pass requisition budgets for land purchases for road construction. Huang has denied the charges, however, Chang Pei-jane, prosecution spokesperson, claims that of the NT$258 million to be paid for the land, that he received NT$160 million in illegal profits. (Taipei Times, Mar. 22, 2001, summary by Marg Reynolds). PROSECUTORS
CHARGE 260 WITH CORRUPTION. CHANGHUA.
Prosecutors indicted 260 people for graft during the March election and
recommended a two-month sentence for each bribe taker. The average bribe was T$300 ($9 U.S.) and
was paid by Nationalist Party officials.
Hsu Tsung-chiung, head of Yuanlin Township and a Nationalist member,
faces a T$1.5 million fine plus a three year jail term. In eastern Taitung, prosecutors charged 45
people with corruption, and these officials will face up to seven years in
prison. Ho Kuo-hua, President of the
Bank of Taiwan, was accused of corruption and prosecutors will recommend he
be charged with embezzlement. (CNN,
Dec. 16, 2000, summary by Marg Reynolds). TAIPEI (Taiwan) – The Taiwanese government has expressed its desire for alleged kickbacks to French contractors from a frigate deal controversy to be paid back. Among other fallout, the illegal 1991 contract for six French built frigates worth $2.08 billion recently caused the impeachment of three senior retired Taiwanese naval generals. Investigations are currently underway into allegations that top Taiwanese and French officials were bribed to facilitate the deal. (Reuters, Dec 7,2000, Summary by Fabian Camacho).
THE FRIGATE SCANDAL AND A MURDER. In an interview in Libération Mr. Roger Hsieh, senior advisor to the new Taiwanese President Chen Shui-bian, accused the French defense firm Thomson of being involved ("playing a central role") in the assassination of a Taiwanese naval commander. In September 1993 Colonel Yin Chin-feng traveled to the ship building yards of Lorient to inspect the six 3,800 ton frigates, then under construction, that Taiwan had bought from the French defense firm, in a 16 billion franc deal. According to Mr Hsieh, during that time Colonel Yin Ching-feng told the head of the Taiwanese delegation: "My life is in danger. If one day I should fall victim to a plot, I beg you to avenge me". Colonel Yin Ching-feng then wrote a damning report describing the performance of the frigates. On 9 December, he disappeared; a day later, his body was fished out of the sea off the coast of northeastern Taiwan. (Source: The Scotsman, November 29,2000, summary by Pavlidis George).
MAGISTRATE SAID TO EMBEZZLE FUNDS FOR EARTHQUAKE VICTIMS. Nantou County Magistrate Pang Pai-hsien was detained in custody after being charged with embezzling funds for last year's earthquake victims. The earthquake left nearly 2,500 people dead and 100,000 temporarily homeless across Taiwan. Nantou was worst hit, with 922 people killed and 57,000 housing units damaged or destroyed. The alleged graft case started when Chief Prosecutor Hsu Sung-kui raided Pang's house and office and found evidence that some financial donations from the public to the government relief funds went to two private foundations chaired by Pang. (Straits Times, 15 November 2000, summary by Debbie Uy). Taipei, GENERALS IMPEACHED IN TAIWAN'S MILITARY SCANDAL. Hau Pei-tsun is a former premier and chief of the military's general staff. In 1993 following the death of Capt. Yin Ching-feng (widely believed to have been murdered) a military scandal was revealed. The Navy of Taiwan was planning to buy six Perry-class frigates from South Korea in 1989. However, Hau Pei-tsun ordered the navy to switch the order to France. Taiwan paid the equivalent of US$460 million for each of the six Lafayette frigates, nearly double the original budget and the modernization of Taiwan's navy was delayed by several years. The Control Yuan investigative committee failed to approve an impeachment motion against Hau but it did impeach three retired generals for executing the order: Yeh Chang-tung, the former navy commander-in-chief, Lei Hsueh-ming, who was in charge of vessels management and Yao Nung-chung, who was in charge of weapons procurement. Nevertheless, the generals won't be penalized because they are retired. (Source: The Times of India, October 26, 2000, summary by Pavlidis George).
TAIPEI - Taiwanese authorities have recently re-opened an investigation on irregular navy deals with France that occurred in 1991. Hau Pei-tsun, former premier and chief of the military, has been accused of administrative oversight in disregarding proper procedures in scrapping a plan to buy six frigates from South Korea and changing the order to France. Though Pei-tsun maintains the decision was correct, it is believed that top elements within the military circle had engaged in accepting kickbacks from the French contractors for different deals related to the switch. (The Times of India Online, October 26,2000. Summary by Fabian Camacho.). TAIWAN’S QUIET
CRUSADER IS MAKING A BIG NOISE. In recent weeks some of Taiwan’s top
politicians have been accused of corruption.
Among them are Yiu Huai-yin, a legislator and financial industry
executive convicted of stock manipulation and Lin Jui-tu a muckracking
lawmaker who faces charges of influence peddling. Ding-Nan Chen, Taiwan’s Justice Minister is determined to
uncover official corruption and pursue that the government and the people
obey the law. (WSJ, September 10, 2000, summary by Maritza Rosado). ANTI-CORRUPTION CAMPAIGN WILL CONTINUE
DESPITE PRESSURE ON LOCAL STOCKS. Taiwan´s economy remains "basically
healthy" and recent stock weakness is due to lack of confidence stemming
from the government´s anti-graft campaign, Taiwan´s Premier Tang Fei said
Thursday. The government won´t ease up on its anti-corruption crackdown,
Taiwan´s number three leader said during a press conference. He added there
are no political considerations in the graft probes. While Tang admitted that
the drive against corruption was adding to the pressure on local stocks as
was the financial problems at a "minority" of companies, he also
emphasized that not attacking corruption and illegal business dealings would
undermine the country´s foundation. If it isn´t a good time to attack
corruption now, "when would a good time be," he said. YAHOO NEWS
(Dow Jones), August 31, 2000 http://www.yahoo.com STOCK MARKET CONTINUES SLIDING ON
CORRUPTION CONCERNS Taiwanese stocks fell for the second day in three as the
government´s drive to root out corruption threatens to expose fraudulent
loans by banks. Chang Hwa Bank and other lenders dropped on concern they
carry more bad loans on their books than analysts expect. The TWSE Index lost
174.84, or 2.3 percent, to 7601.78. The index´s now down a quarter of its
value since its Feb. 17 year- high. "Anti-corruption actions have caused
the market to fall," said John Lin, who helps manage $20 billion ($643
million) in Taiwan equities at National Investment Trust Ltd. In the past
month, about a dozen Taiwanese politicians and executives have been arrested
amid government efforts to uncover corruption and fraud. Most recently,
investigators arrested a politician on charges of manslaughter and illegally
profiting from earthquake reconstruction funds. Taiwan´s central bank
estimates that bad bank debt stood at NT$704 billion ($23 billion), or 5
percent of total lending, at the end of June. Steve Chou, who helps manage
$400 million in Taiwan equities at Truswell Securities Investment Trust Ltd.,
said the bad loans of the banks could be higher than 10 percent of their
total loans. BLOOMBERG, September 6, 2000
http://quote.bloomberg.com
CORRUPTION PROBE WORRIES INVESTORS George Chang was among about a
dozen Taiwanese politicians and executives caught up in a drive to root out
corruption last month - and the first member of the governing party to be
charged. The move only heightened investor concern that President Chen
Shui-bian may dig up more dirt than he anticipated when he ended five decades
of single-party rule in March. The nation´s key stock index, already the
world´s second-worst performer over the past five months, may have further to
fall. "When you are digging out all the illegal stuff, the market and
all the investors are going to lose confidence," said Albert King, a
money manager at China Securities Investment Trust Corp. in Taipei. On the
surface, Taiwan appears to be Asia´s most resilient economy, riding out the
currency crisis with two years of growth at about 5 percent in 1998 and 1999
and on course for more than 6 percent growth this year and next. Probe a
little deeper and investors worry that Mr. Chen could find out that twice as
many loans cannot be repaid as the government estimated, many of them made
without either side expecting repayment, and a host of public works projects
carried out simply to line the pockets of local politicians and
businesses. Investors say Taiwan´s
financial problems have yet to be fully exposed and it will be some time
before the benefits of Mr. Chen´s drive outweigh its disruptions. The biggest
problem is that some Taiwan banks extend loans as favors rather than for
profit. The government estimates 6 percent of $482 billion in bank loans
cannot be repaid by borrowers, largely because they should never have been
extended in the first place. Some fund managers see the real figure at closer
to 12 percent. As the true extent of bad debt becomes known, the government
plans to set up an agency to take the loans off the lenders´ balance sheets.
Such an institution, much like the Resolution Trust Corp. in the United
States, could not come soon enough for investors. International Herald
Tribune, September 5, 2000 http://www.iht.com Taiwanese Cabinet Is Likely to Retain Key
Policies of Departing Government, Mr. Chen won the March 18 election with
just 39% of the vote, and is seen by many as having a mandate that is mainly
limited to cracking down on organized crime and corruption. (See item 8, May
2, 2000 WSJ by Russell Flannery staff reporter). TAIPEI, Mr. Chen
won the March 18 election with just 39% of the vote, and is seen by many as
having a mandate that is mainly limited to cracking down on organized crime
and corruption. (W S JOURNAL, Asia May 2, 2000) Taiwan indicts parliamentarian in
anti-graft drive (Business Recorder, 21.8.00,
http://www.brecorder.com/story/S00DD/SDH21/SDH21156.htm). TAIWAN: INDICTMENTS ISSUED IN GOVERNMENT
ANTI-CORRUPTION PURGE
http://support.casals.com/aaaflash1/busca.asp?ID_AAAControl=2963 China Times, August 21, 2000
http://www.chinatimes.com.tw TAIWAN:
ANTI-CORRUPTION DRIVE TESTS POLITICAL RELATIONSHIPS http://support.casals.com/aaaflash1/busca.asp?ID_AAAControl=2936 The Straits Times, August 18, 2000 http://straitstimes.asia1.com.sg/asia/ea2_0818.html TAIWAN: II INDICTED INCLUDING LAWMAKER PN
FRAUD AND FORGERY CHARGES http://support.casals.com/aaaflash1/busca.asp?ID_AAAControl=2947 AOL News (Reuters), August 20, 2000 http://www.aol.com The Index of Economic Freedom (by Driscoll-Holmes-Kirkpatrick) for 2001 places Taiwan in the “Mostly Free” category with a rank of 22 (Ranks range from 1 for Hong Kong to 155 for North Korea, Wall Street Journal, Nov. 1, 2000). H. D. Vinod’s trimmed correlation analysis indicates that countries free from economic regulation are less corrupt. After allowing for some exceptions by 20% trimming, the correlation is near 0.9. |
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Design:
Theo den Brinker |
Copyright:
Hrishikesh D. Vinod 2000 |
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