Ex-president's son found guilty of money laundering in retrial

The Taiwan High Court on Friday upheld previous sentences meted out to the son and daughter-in-law of former President Chen Shui-bian in a money laundering case but reduced their fines.

The court found that Chen Chih-chung and Huang Jui-ching had helped Chen Shui-bian and his wife Wu Shu-jen launder, hide and transfer abroad funds obtained illicitly, but that they did not benefit financially from those transactions.

It therefore decided to cut the NT$30 million (US$1.03 million) Chen was fined in his most recent trial to NT$4.5 million and slash Huang's fine from NT$20 million to NT$4 million.

The court, however, upheld Chen's 14-month prison sentence and Huang's one-year sentence, but still allowed Huang the option of paying NT$10 million to national coffers to have the one-year sentence commuted to a four-year suspended sentence.

Both Chen and Huang can still appeal the ruling.

The two were first convicted by the Taipei District Court in September 2009 for having engaged in money laundering during Chen Shui-bian's presidency from 2000-2008.

Chen was given a 30-month jail sentence and fined NT$150 million. Huang was also fined NT$150 million and sentenced to 20 months in prison, but she was given the option to pay NT$200 million to commute the jail time to a five-year suspended sentence.

In a second trial, the Taiwan High Court ruled on June 11, 2010 to cut Chen's sentence to 14 months and reduce his fine to NT$30 million.

Huang's fine was cut to NT$20 million, and she was given a one-year sentence that could be commuted to a four-year suspended sentence with a payment of NT$10 million.

The rulings were appealed to Taiwan's Supreme Court, which sent the case back to the Taiwan High Court Nov. 11, 2010 for retrial, resulting in Friday's rulings.

The case has not been Chen Chih-chung's only legal entanglement. In a final verdict rendered by the Supreme Court on Aug. 18, the former president's son was sentenced to three months in jail without probation for committing perjury in a corruption case involving his parents.

The verdict prompted the Executive Yuan to strip him of his seat in the Kaohsiung City Council. Chen has vowed to fight the Executive Yuan's order. 

Source: Focus Taiwan

Apple Global Supply Manager Accused of Accepting $1 Million in Kickbacks

A mid-level Apple manager faces twenty-three counts of a federal grand jury indictment alleging that the 37-year-old Paul Shin Devine, a global supply manager, is guilty of wire fraud, money laundering, and kickbacks related to his position at the company. Andrew Ang, of Singapore, faces the same charges as well.

And if that's not bad enough, Apple itself has filed a separate civil suit against Devine, alleging that the Sunnyvale, CA-based (former) employee accepted more than $1 million in bribes and kickbacks from countries including China, South Korea, Taiwan, and Singapore.

According to the indictment, Devine allegedly used his position at Apple to acquire various bits of confidential information about the company. He would turn around and sell this information to more than a half-dozen Apple suppliers—including the aforementioned Ang—and both would receive payments for their efforts. Using the confidential knowledge, said suppliers would be able to better position themselves to bid for and receive Apple contracts.

The San Jose Mercury News reports that the companies in the indictment remained unnamed, but they're said to be involved in supplying materials for Apple's iPods and iPhones.

"Apple is committed to the highest ethical standards in the way we do business," said Apple spokesman Steve Dowling in a statement. "We have zero tolerance for dishonest behavior inside or outside the company."

The somewhat-complicated scheme, reads the indictment, involved a number of U.S. and foreign bank accounts, as well as the falsified company "CPK Engineering," to process the payments. Devine allegedly attempted to conceal the money transfers using code words as to not clue his employer into what was actually transpiring, and would even go so far as to open the foreign bank accounts in his wife's name.

The Internal Revenue Service reports that Devine is currently in the custody of U.S. Marshals, awaiting a 1:30 p.m. court appearance this coming Monday in the U.S. Northern District Court in San Jose.

Source: PC Mag

Taiwan: Spy chief faces jail in money-laundering case

Taiwan's ex-intelligence chief has been indicted for allegedly covering up for the former president Chen Shui-bian over suspected money laundering.

Yeh Sheng-mao, a former director of the Investigation Bureau, faces more than two years' jail if found guilty of concealing evidence, said a spokesman for the Taipei district prosecutor's office.

"Yeh was a public servant when the crime was committed … As the director, he should be in charge of investigating money laundering but he failed to report the documents according to the procedure," the spokesman said.

Prosecutors raided Yeh's home last week. He has not commented on his indictment.

Yeh, who retired in July after more than six years in the post, is the first person to be charged after the island launched a probe this month into money-laundering claims against the Chen family.

Chen, his wife, son, daughter-in-law and brother-in-law have all been named as suspects in the case.

The ex-president has admitted his wife wired $US20 million ($23.3 million) abroad from his past campaign funds, but said she did so without his knowledge. He has denied any illegal activity.

Chen, who left office in May, is already being investigated for allegedly embezzling $T14.8 million ($560,200) in expenses, while his wife is on trial for corruption and document forgery in the same case.

Source: SMH

Taiwan seeks help of foreign banks in money-laundering probe

Taiwan has sought the help of international banks as part of its probe into an alleged money-laundering case implicating former president Chen Shui-bian and his family, a prosecutor said Tuesday.

Merrill Lynch & Co., Credit Suisse Group and ABN Amro Holding NV are among the banks that have pledged to assist the investigation, said a prosecutor who declined to be named.

"We are seeking assistance from the banks as witnesses," the prosecutor said, without elaborating.

When contacted by phone, Merrill Lynch spokeswoman Vicki Kwong said: "As in normal practice, Merrill Lynch is cooperating with authorities."

Taiwan launched a probe this month into alleged money laundering implicating the former first family, following similar moves by Swiss authorities.

Copies of Swiss documents obtained by a Taiwanese lawmaker showed Chen's son Chen Chih-chung and daughter-in-law Huang Jui-ching transferred 31 million US dollars to her Swiss bank accounts in 2007.

They were also suspected of laundering money by setting up companies in the Cayman Islands.

Prosecutors have named the couple and Chen Shui-bian, his wife and brother-in-law, as defendants in the case.

The ex-president has admitted that his wife wired 20 million US dollars abroad from his past campaign funds, but said she did so without his knowledge. He has denied any illegal activity.

His son and daughter-in-law have said they merely did their mother's bidding and were unclear about "the source or the background" of any transferred funds.

Chen, who left office in May, is already being investigated for allegedly embezzling 14.8 million Taiwan dollars (480,500 US) in special expenses while president, and his wife is on trial for corruption and document forgery in the same case.

Source: AFP

Secret documents discovered in Taiwan’s ex-president’s residence

Prosecutors discovered a dozen of classified documents during the search in former president Chen Shui-bian’s residence and office. Some of them are letters from Prosecutor Chen Juei-jen sent to various departments to request for investigation of secretive diplomacy, or documents asking judicial police to audit accounts. Apparently, Chen had known prosecutors’ actions and acquired evidence via intelligence unit.

These documents are mostly issued by corruption investigation center to Ministry of Foreign Affairs, National Security Bureau, to investigate secretive diplomacy of Gong Case in the reign of former president Lee Teng-huei, including reports of Lee’s possible overseas money laundering under prosecutors’ order to the Money Laundering Prevention Center.

The then-Director of Bureau of Investigation was Yeh Sheng-mao, who was indicted by Taipei Prosecutor’s Office for revealing money laundering information and documents to Chen. Therefore, it is possible that this case was also covered up by Yeh.

by Taiwan News, Website Editorial Staff

Son of Taiwan ex-leader returns to face money laundering charges

The son and daughter-in-law of Taiwan's ex-president Chen Shui-bian Monday returned to the island to face a probe into alleged money laundering implicating the former leader. The couple, listed as defendants along with the ex-leader and his wife Wu Shu-chen over their alleged roles in the scandal, insisted they knew nothing about a 20 million US dollar fund kept at their bank accounts set up by a Swiss bank in Cayman Islands.

"I have no idea about the funds because my mother has long been the one handling the family's money," said the son Chen Chih-chung at the airport.

He stressed he did not know about the source and how the fund was wired abroad.

His wife, Huang Jui-ching, also said her mother-in-law, Wu Shu-chen, asked her to sign some documents, which she did as she was told without asking why.

They insisted that their return to Taiwan is a solid proof that they want to cooperate with the judicial authorities in clearing themselves and their family. Taiwan prosecutors have issued summons for the couple, who left Taiwan on August 9, just days before the scandal came to light earlier in August.

Taiwan's prosecution authorities have listed the former president Chen and four of his family members as defendants over their alleged roles in a high-profile money laundering scandal.

The scandal came to light on August 11 after Swiss judicial authorities notified Taiwan after finding unusual fund transfers through the son and daughter-in-law accounts set up by a Swiss bank.

The Supreme Prosecutor's Office launched the probe after Chen admitted at a news conference on August 14 that his wife had remitted 20 million US dollars worth of previous campaign donations abroad without telling him. He said his wife told him this was done in preparation for their retirement after he stepped down as president in May.

On August 16, prosecutors barred the ex-leader and his wife from going abroad, after searching Chen's home and office and Wu's home earlier in the day.

Investigators claimed to have found details of four secret bank accounts opened in 2000, the year Chen won the presidential election.

Chen said the money was from campaign funds that he had failed to declare. But prosecutors are trying to determine if the couple was attempting to launder illegally-obtained money through their son and daughter-in-law as well as other relatives.

The money laundering scandal has dealt a crushing blow to Chen's Democratic Progressive Party (DPP), which lost its eight-year grip on power to the pro-China Kuomintang (KMT) party in the March 22 election.

Chen, who served two four-year terms as president between 2000 and 2008, resigned from the DPP on August 15 as the party was preparing to expel him.

Source: The Earth Times

Swiss representative pledges aid in Chen scandal

The Swiss Representative to Taiwan, Jost Feer, says Switzerland is committed to combating money laundering. He said his country will offer legal assistance to Taiwan once evidence is provided in a high-profile case involving Taiwan's former first family. Feer made the remarks in response to the latest scandal implicating former President Chen Shui-bian and his family.

In July, Taiwan received a request from the Swiss authorities for
Assistance in probing alleged money laundering by Chen's son Chen Chih-chung and his daughter-in-law Huang Jui-ching in Switzerland.

In Taiwan, the former president confessed in August that he did not honestly account for his election campaign expenses. He also said that his wife Wu Shu-jen funneled surplus funds from election campaign contributions into overseas bank accounts. He said that this was done without his knowledge.

Feer said that Taiwan is not a special case and that as long as there is evidence of criminal activities, Swiss authorities will look into it.

Source: RTI

Taiwan to criminalize unexplained wealth

The Ministry of Justice (MOJ) aims at criminalizing unexplained wealth for government officials, Vice Justice Minister Huang Shih-ming said yesterday.

The statement came less than a week after an investigation was launched into money laundering claims apparently implicating former president Chen Shui-bian and his family, following similar moves by Swiss authorities.

Speaking at a news conference, Huang drew on similar laws existing abroad to explain that Taiwan aims at better monitoring illicit flows of money and combat money laundering.

As Chen and his wife Wu Shu-jen deposited large sums of cash abroad under the names of their family members, he stressed that the MOJ will seek to broaden cross-border judicial cooperation with foreign governments in Switzerland, Singapore and the United States.

In the meantime, Huang said the MOJ offers a NT$10 million reward to anyone providing information leading to a break in the case over the latest money-laundering allegations against the former first family.

The MOJ also urges companies, organizations or individuals who were involved in the alleged money laundering operations to take a moral stance and come forward to help solve the case.

During a questioning at her residence last week, the former first lady told prosecutors that the US$21 million remitted in the family's various overseas bank accounts was "all legal income."

The hefty sum was reportedly rifled into three bank accounts: two in Switzerland held in the names of her daughter-in-law Huang Jui-ching and one in Singapore under the name of her brother Wu Ching-mao.

In November 2006, Chen's wife was first charged with corruption and forgery for using receipts provided by others to claim reimbursements totaling NT$14.8 million from the president's "state affairs fund" between July 2002 and March 2006.

Chen, who was named as a co-defendant in the same case but enjoyed immunity from prosecution while he was in office, came under questioning shortly after he stepped down from the presidency May 20.

After he admitted Aug. 14 that he lied about his campaign expenses for his two mayoral elections and two presidential elections, and that his wife had transferred surplus campaign contributions to overseas bank accounts, prosecutors imposed an overseas travel ban on him.

Prosecutor Ching Chi-jen left for Switzerland Aug. 15 to review the accounts under the name of Chen's daughter-in-law at Merrill Lynch Bank after the Federal Department of Justice and Police of the Swiss Confederation requested assistance from Taiwan in a case of suspected money laundering by Chen's son and his daughter-in-law, through two Swiss bank accounts.

The prosecutors also searched Chen and Wu's home over the weekend.

Source: China Post

Alleged Money Laundering of Ex-President Chen Impacts Financial Stocks

The alleged involvement of former President Chen Shui-bian in massive overseas money laundering drove down the share prices of some major financial stocks by 7%, the daily maximum limit, yesterday (Aug. 18), due to the rumor alleging that Chen received huge bribes from them during the second financial reform.

The most noticeable case is Taishin Financial Holding, whose share price closed at NT$10.05 yesterday, barely higher than the par value of NT$10, a record low, overshadowing the company`s plan to raise fresh fund via cash capital increment by issuing 450 million new shares in December.

To cope with the crisis, Taishin runs advertisements on all major local newspapers today, categorically denying involvement in any irregular activities and vowing to take legal moves against those who spread rumors against the company, so as to uphold the interests of its shareholders and its affiliate Chang Hwa Commercial Bank.

Lin Keh Hsiao, Taishin president, denied yesterday giving Chen NT$2.7 billion to facilitate the takeover of Chang Hwa Bank in 2005, in refuting the statement of Shih Min-teh, former chairman of Democratic Progress Party that "a domestic enterprise gave Chen NT$2.7 billion."

Lin noted that Taishin obtained 400 million shares of Chang Hwa in 2005 at NT$26.12 per share, totaling NT$$36.5 billion, NT$11.4 billion higher than the floor price and NT$7 billion higher than the second highest bid tendered by Taemasek of Singapore.

The participation of Taishin has helped vitalize Chang Hwa`s operation, including write-off of NT$70 billion bad debt, increase of return on equity (ROE), and increase in the latter`s share price, according to Lin.

Despite its huge spending, Taishin has yet to complete the merger with Chang Hwa, which, plus the impact of the twin-card debt storm, has driven down its share price from the level of NT$27.65 on July 22, 2005, when it won the bidding for Chang Hwa shares.

(by Philip Liu)

Source: CENS

Former first lady's brother confesses to remitting money via illegal channels

The China Post news staff
Tuesday, August 19, 2008

Wu Ching-mao, the brother-in-law of ex-president Chen Shui-bian, said yesterday that he remitted mo

ney abroad via underground channels on behalf of his younger sister Wu Shu-jen, the former first lady, according to the Special Criminal Investigation Unit (SCII) of the Supreme Prosecutor Office.

Wu made the remarks when questioned by the SCII over his alleged role in the suspected money laundering involving the former first family.

Wu told prosecutors that since Chen was elected Taipei mayor in 1994, he started to use his account at a Dutch bank in Singapore to manage funds for his younger sister. Touching on credit transfer methods, Wu said he sometimes remitted money abroad via banks, and sometimes through underground channels.

Chen's brother-in-law also noted that sometimes he made remittances on his own, but sometimes asked his wife Chen Chun-ying to do the job.

Prosecutors were surprised to hear Wu's remarks concerning remittances via underground channels, and they wondered very much why Wu chose underground remittance channels.

Earlier, former first lady Wu Shu-jen told prosecutors that all the funds, around US$20 million, remitted abroad were all legally obtained. "If so, why should her elder brother use underground remittance channels, instead of legal ones?" prosecutors asked.

Prosecutors said that they would also move to question operators of the underground remittance channels on charges of violating the Banking Act by handling the remittances for Wu.

For his alleged role in the suspected money laundering scandal, Wu Ching-mao has been listed as a defendant in the case and has been banned from leaving the country.

Ex-president Chen, Wu Shu-jen and their son Chen Chih-chung, as well as daughter-in-law have all been listed as defendants in the suspected money laundering case as evidence emerged about the former president and his wife using their daughter-in-law to transfer US$20 million of funds through her two Swiss bank accounts.

The scandal came to light recently after Swiss prosecution authorities sought Taiwan's help in a probe into a possible money laundering case in Switzerland involving the ex-president's son and his daughter-in-law.

Also yesterday evening, Wu Ching-mao's wife, Chen Chun-ying, was sent to the National Taiwan University Hospital (NTUH) for emergency medical treatment after she fainted while being questioned by prosecutors. Wu claimed that her wife attempted to commit suicide amid heavy questioning and pressure from prosecutors by taking a certain kind of pill. Wu accused prosecutors of pressing his wife to confess to allegations beyond her knowledge, leading to her suicide attempt.

Prosecutor Chu Chao-liang, spokesman of the SCII, said that Wu told prosecutors that his wife took a kind of sedative to mitigate the interrogation pressure, during a break in the questioning session. Prosecutors allowed Wu to take his wife to receive medical treatment at the NTUH, according to Chu.

Chu continued by saying that the entire questioning process, carried out in a legal way, had been recorded and videotaped.

Meanwhile, prosecutors also questioned Lin Wen-yen, chairman of China Steel Corp., over his alleged role in managing the election campaign budgets to see if the money remitted abroad by ex-president Chen was related to the campaign budget surplus.

Lin said he was responsible for controlling the campaign budgets for Chen, adding that he knew little about Chen remitting money abroad.

Source: The China Post

Singapore to help Taiwan probe ex-president's offshore accounts

Author : DPA

Taiwan on Monday thanked Singapore for offering to help Taipei probe suspected money laundering by former president Chen Shui-bian. "We are happy to see that Singapore is willing to provide legal assistance and to jointly fight cross-country crime," the Central News Agency (CNA) quoted Deputy Foreign Minister Andrew Hsia as saying.

Hsia made the remark after Singapore's trade office announced that Singapore would assist Taiwan in probing the suspected money laundering by former president Chen and his family.

Because it refuses to allow its financial system to be used for illegal activities, Singapore contacted Taiwan's Supreme Prosecutor's Office to provide the necessary assistance allowable by Singaporean law, Singapore's trade office was reported as saying.

In January 2008, Chen's wife Wu Shu-chen deposited 20 million US dollars - campaign funds from the 2000 and 2004 presidential election which Chen has not declared - into several foreign bank accounts, and eventually into a Swiss bank account.

One of the deposits was made to an account at the Standard Merchant Bank Asia in Singapore opened by Wu's elder brother Wu Ching-mao.

Taiwan has also required legal assistance from Swiss prosecutors.

Chen, former chairman of the Democratic Progressive Party (DPP), served as Taiwan's president from 2000-2004 and from 2004-2008.

Corruption scandals involving Chen's family and DPP officials caused the party to lose the 2008 election to the pro-China Chinese Nationalist Party (KMT).

Chen quit the DPP on August 15 as the party, in reaction to his money laundering allegations, was preparing to expel him.

Source: The Earth Times

Taiwan seeks Swiss help in probing ex-president's offshore accounts

Taiwan is seeking assistance from Switzerland in probing suspected money laundering by former president Chen Shui- bian, a prosecutor said on Sunday, the dpa reported.

"I have asked Swiss judicial authorities for legal assistance ... to pass on to us all the data they have on the case, and to return Chen's assets if it is proven that they were obtained illegally," Prosecutor Ching Chi-jen told reporters upon her return from Switzerland.

"Regarding our request for legal assistance, we received a positive reply," she said at Taoyuan International Airport outside Taipei.

Ching flew to Switzerland on July 12 after Swiss judicial authorities alerted the Taiwan government about suspicious transfers into a bank account opened by Chen's daughter-in-laughter Huang Jui- ching.

The bank account holds 20 million US dollars, wired in from Taiwan through several foreign banks.

After the Taiwan press reported Chen's suspected money-laundering, Chen held a news conference Thursday, admitting he failed to declare campaign funds from the 2000 and 2004 presidential elections, and his wife Wu Shu-chen had remitted the funds abroad this January without telling him.

But prosecutors are trying to determine if the couple was attempting to launder illegally obtained money.

Investigators claimed to have found details of four other secret bank accounts, three opened in 2000, when Chen won the presidential election, and one opened in 2004, when he was re-elected for a second four-year term.

The four accounts hold a total of 500 million Taiwan dollars (16 million US dollars).

On Saturday, prosecutors barred Chen and his brother-in-law Wu Ching-mao from going abroad after searching Chen's home and office and Wu's home earlier in the day, the Taiwan daily China Post reported.

Wu, elder brother of Chen's wife Wu Shu-chen, allowed Wu Shu-chen to use his bank account to wire money abroad.

Chen was the former chairman of the Democratic Progressive Party (DPP).

Corruption scandals involving Chen's family and DPP officials caused the party to lose the 2008 election to the pro-China Chinese Nationalist Party (KMT).

Chen quit the DPP on Friday as the party was preparing to expel him.

Source: Trend News

Taiwan ex-president quits party over alleged money laundering

Taiwan's former president Chen Shui-bian on Friday quit the Democratic Progressive Party (DPP) after money laundering allegations against him and his family surfaced this week.

"I have to say sorry to DPP members and supporters with a heavy heart. I let everybody down and caused irreparable damage to the party. This was not my intention but I made mistakes," Chen said in a statement.

"To show my deepest remorse, my wife Wu Shu-chen and I leave the DPP from now," he said.

The statement came hours after Taiwan's premier, Liu Chao-shiuan, confirmed an investigation had been launched into the money laundering claims apparently implicating the Chen family, following similar moves by Swiss authorities. Swiss prosecutors "have requested assistance in their investigation and we have immediately started our own probe," Liu told reporters.

The Taipei District Prosecutors' Office sent a top official to Switzerland earlier this week "to exchange views" with the authorities there, said spokesman Fred Lin.

The former president admitted that his wife Wu Shu-chen had wired abroad 20 million USD from his past campaign funds, saying she had done so without his knowledge.

Copies of Swiss documents obtained by Kuomintang lawmaker Hung Hsiu-chu showed that Chen's son Chen Chih-chung and daughter-in-law Huang Jui-ching had transferred 31 million USD to Huang's Swiss bank accounts in 2007.

The couple left Taiwan on August 9 before the case came to light, according to Taiwanese authorities.

Their whereabouts are not immediately clear and the allegation is that some of the 31 million may have come from Chen's campaign funds and state coffers.

Chen has denied money laundering.

A string of corruption scandals implicating Chen, his family and top DPP officials has tarnished the party's image and played a part in the party's defeat in the March presidential vote.

DPP chairwoman Tsai Ing-wen also apologised to the public and said the party would not cover up for Chen.

Chen is already under investigation for allegedly embezzling 14.8 million Taiwan dollars (480,500 US) in special expenses from the government while he was president, and his wife is on trial for corruption and document forgery in the same case.

He was named a suspect in that case in 2006 but escaped immediate prosecution because he had presidential immunity.

The ex-president was questioned Tuesday over the embezzlement allegations, a week after his successor Ma Ying-jeou declassified documents allegedly implicating him.

Chen has admitted using false receipts to claim money from the state, but insisted those funds were used for "secret diplomatic missions" and not his personal benefit.

Nevertheless, prosecutors found that at least 1.5 million Taiwan dollars had been spent on diamond rings and other luxury items for his wife.

Prosecutors launched a probe against Chen on May 20 -- the day he left office after his second and final four-year term.

Source: AFP

Taiwan detains former security chief in money-laundering scandal

A Taiwan court on Monday ordered the detention of former internal security chief Yeh Sheng-mao for alleged corruption and reportedly leaking top secrets to former president Chen Shui-bian over a money-laundering scandal. "He allegedly violated the anti-corruption law by covering up the case in a bid to profit a third party," a court spokesman said of Yeh. "He also allegedly violated the national classification information law by leaking top secrets to a third party."

The court detained Yeh to prevent him from hampering evidence, said the court spokesman.

Yeh was charged in late August with concealing documents that hindered investigations into the alleged money laundering implicating Chen. Prosecutors are seeking a jail sentence of two and a half years against him.

The documents concerning alleged money laundering by Chen's wife, Wu Shu-chen, were submitted by the head of the anti-money laundering centre to then-director of the Investigation Bureau, Yeh, in February, according to the indictment.

Yeh later told the head of the centre that he had personally handed the documents to prosecutor-general Chen Tsung-ming for further investigation and necessary legal action, the indictment said.

Yeh never passed on the documents, claiming later he forgot as he was busy during the transition between governments. He said he had verbally told the prosecutor-general about the issue, but Chen Tsung-ming denied the claim.

On August 21, prosecutors searched Yeh's home and found copies of the documents, indicating that it is unlikely that Yeh forgot about them, the indictment said.

Yeh was the first person to have been indicted in the snowballing money laundering scandal involving the former president and his family.

The allegations surfaced in June when Swiss judicial authorities alerted Taiwan after detecting unusual transfers of 21 million US dollars in bank accounts set up by Swiss banks in the Cayman Islands for Chen's son and daughter-in-law.

The scandal was first revealed by a Taiwan magazine on August 10. On August 14, Chen admitted that his wife had remitted 21 million US dollars into several foreign bank accounts.

Chen had not declared the monies, which were leftover campaign funds from the 2000 and 2004 presidential election.

Two former chief aides of Chen and an associate of Wu were also arrested for their alleged roles in helping with the fund management and transfers.

Prosecutors have questioned Chen, his wife, brother-in-law, son and daughter-in-law over their alleged roles in the scandal and barred them from leaving Taiwan.

Chen stepped down as president in May after serving two terms from 2000. He was succeeded by Ma Ying-jeou of the Nationalist Party.

Source: The Earth Times

12th defendant named in Taiwan's former first family's money laundering case

The Special Investigation Division of the Supreme Prosecutors Office on Friday listed a college classmate of former first lady Wu Shu-jen as a defendant for allegedly helping Wu with money laundering, increasing the number of defendants in the case to 12.

Prosecutor Chen Yun-nan, director of the division, confirmed that his division had summoned Wu's former classmate Tsai Mei-li for questioning as a defendant in the case, but said Tsai begged out of the session because she was ill.

Tsai's two brothers -- Tsai Ming-che and Tsai Ming-chieh -- have already been listed as defendants in the case for allegedly serving as proxies in helping the former first family launder money abroad.

In addition to Wu, three other members of the former first family -- former President Chen Shui-bian, son Chen Chih-chung and daughter-in-law Huang Jui-ching -- have all been listed as chief defendants in the money laundering case.

Others listed as defendants include the former first lady's elder brother Wu Ching-mao, his wife Chen Chun-ying, former Mega Financial Holding Co. Chairman Cheng Shen-chih, Yuanta Securities board member Tu Li-ping, and former Presidential Office cashier Chen Chen-hui.

None of those listed as defendants in the case have been indicted on charges related to money laundering, as at this stage in the investigation they are still only viewed as suspects.

Wu Ching-mao was released Nov. 28 on NT$2 million (US$59,580) bail after he had been held in custody for 53 days to prevent possible collusion among the defendants and witnesses.

Prosecutors who examined the information provided by judicial authorities of Singapore about an account owned by Wu Ching-mao believe they have enough evidence to suspect that Tsai Mei-li and her brothers helped the former first lady transfer millions of U. S. dollars illegally to her brother's account with South Africa's Standard Bank in Singapore through their bank accounts in Hong Kong.

Prosecutors found that they money was later wired to a Swiss bank account held by the son and daughter-in-law of the former president and his wife.

Before listing Tsai Mei-li as a defendant, the prosecutors questioned her four times. On Sept. 25, they searched her residence and office for possible evidence. Her brother Tsai Ming-che has been held in custody since Oct. 2.

In addition to their alleged violations of laws against money laundering, Chen Shui-bian and his wife also face investigation on charges of embezzling state affairs funds of the Presidential Office and accepting bribes during the former president's two terms between 2000 and 2008.

With the permission of the Taipei District Court, the Special Investigation Division has detained the former president since Nov. 12, after interrogating him for six hours a day earlier.

Source: Taiwan News

Cayman Islands Bank Cited In Former Taiwan President`s `Laundering` Case

The family of former Taiwan President, Chen Shui-bian, is accused of laundering money in several overseas accounts, including in the Cayman Islands.

Chen`s family is suspected of depositing at least T$1 billion in banks in Japan, the United States, the Cayman Islands, Singapore and Switzerland, among other places, Taiwan media reports indicate.

But Chen has denied any wrongdoing.

`There is absolutely no graft, absolutely no stolen money,` he told a news conference this week.

Chen has admitted `expatriating` $20 million, but claims the money came from unused campaign contributions - permissible under Taiwan's law at the time - and was intended to underwrite the island's `diplomatic work.`

Source: Carib World News

Top prosecutor denies receiving reports on money-laundering case

State Public Prosecutor General Chen Tsung-min of the Supreme Prosecutor Office de

nied again that former chief of the Investigation Bureau, Yeh Sheng-mao, gave him an oral report in February about an international probe into possible money laundering by the family of former President Chen Shui-bian.

Chen Tsung-min denied the statement made by Yeh at a press conference yesterday afternoon.

Yeh admitted he handed over the original copies of the documents sent in January this year by the Egmont Organization, an international body fighting against money laundering, to the former president.

He also gave President Chen information about an earlier notice in 2006 concerning an international probe into the offshore bank accounts of Chen's wife.

But Yeh also insisted he had separately reported the cases to his boss, Chen Tsung-min.

Chen Tsung-min declined to accept the relevant documents and only told Yeh that the MJIB should continue the investigation, according to Yeh.

But Chen Tsung-min said he already stated several times earlier that he never received relevant reports from Yeh.

He said he worked only Feb. 1, 4 and 5, as he had taken his annual leave, and there was a long Chinese Lunar New Year holiday season during the month.

Chen Tsung-min said he did not meet with Yeh during the month.

Yeh was indicted for withholding important information and prosecutors are seeking a jail term of two-and-a-half years for him.

Source: The China Post

Organized Crime Embraces Film Piracy; Terrorists May Follow, Report Says

By Matthew Harwood

Film piracy by organized crime is flourishing worldwide, with some of the proceeds possibly financing terrorism, according to a new report from the RAND Corp. financed by the Motion Picture Association.

“If you buy pirated DVDs, there is a good chance that at least part of the money will go to organized crime and those proceeds fund more dangerous criminal activities, possibly terrorism,” said RAND’s Greg Treverton, the study’s lead author.

The criminal organizations that traffic pirated DVDs span the globe and often have multinational criminal connections. The report tells of one Italian crime boss turned government witness who explained the his organization's connection to Chinese and Taiwanese criminal gangs involved in film piracy and other acts of counterfeiting.

“Given the enormous profit margins, it’s no surprise that organized crime has moved into film piracy,” said Treverton.

The profits associated with film piracy are astounding, outperforming revenue generated from both Iranian heroin and Colombian cocaine. In Malaysia, a pirated DVD costs 70 cents to make and sells on a corner in London for $9, more than 1,000 percent markup.

The report also discusses three groups that have used film piracy to finance terrorism. The best-documented case involves the Irish Republican Army, which used film piracy among other criminal activities, to fund its terrorist campaign against the British government. Another case involves the D-Company, an Indian criminal group heavily involved in film piracy. In 1993, the group carried out a string of bombings on what became known as “Black Friday” in Mumbai, killing 257 people and wounding hundreds more.

The third example has the most relevance today.

In 2004, the U.S. government labeled DVD pirate and counterfeiter extraordinaire Assad Ahmad Barakat “a specially designated global terrorist” for transferring $3.5 million to Hezbollah. His criminal network operates within the heavily Lebanese tri-border area of Argentina, Brazil, Paraguay, in what RAND calls “most important center for financing Islamic terrorism outside the Middle East.” (For more on the connection between Islamic extremism, terrorist financing, and the tri-border region, see John Barham's "Hezbollah's Latin American Home," from the Feb. 2008 issue.)

RAND notes the boom in film piracy is directly linked to weak penalties when someone is caught and convicted, which is rare.

An individual convicted of selling counterfeit products in France can expect a maximum of two years in prison and a $190,000 fine compared to ten years in prison and a fine of $9.5 million if caught selling drugs. In the United States, 134 people were sentenced to federal prison for intellectual property crimes in 2002, while 1.5 million people were arrested for drug offenses nationwide in 2003.

If governments worldwide want to decrease the volume of counterfeited goods and cut off a possible avenue of terrorist financing, RAND recommends spending more money and manpower to address the problem while passing tougher penalties for those convicted of counterfeiting and other intellectual property crimes.

Source: Security Management

Chen funds in Swiss bank may be retrieved

Former President Chen Shui-bian's NT$1.27 billion (US$38 million) in Switzerland may still be retrieved, Special Counsel spokesman Chen Yun-nan said yesterday.

Two Swiss banks have reported former first son Chen Chih-chung laundered the money, which his mother claimed was political contributions.

President Chen and his wife Wu Shu-chen were convicted of corruption and sentenced to life in prison on September 11. They are appealing to the Taiwan High Court where they, together with their son, will be given a second trial and tried for money laundering.

Chen Yun-nan told the press the Special Counsel asked the Swiss Federal Attorney General to freeze the laundered fund in Merrill Lynch and Wegelin Banks in Zurich twice in writing last year.

He said the first letter was sent immediately after the former president apologized to the public on August 14 last year for “doing what the law forbids me to do.”

The other letter was sent before the Special Counsel indicted the former first family for corruption and money laundering on November 13.

“However,” the Special Counsel spokesman said, “we have received no word from Switzerland.”

So far as the Special Counsel is concerned, he went on, the two accounts in the Swiss banks were not frozen. If frozen, Chen Chih-chung couldn't make any withdrawal.

That was one of the reasons why the Special Counsel requested a continued detention of the ex-head of state. He might escape out of country to enjoy the fortune he stashed away.

“Now that President Chen has been convicted and sentenced by the Taipei District Court, we will write again to the Swiss Attorney General to get the money back,” Chen Yun-nan said.

In particular, he said, the letter will be written in a “foreign language.” He did not say whether it would be in English, German, French or Italian, however. The last three are all official languages in Switzerland.

He commented on a Central News Agency report that the Swiss Attorney General has never received any inquiry from either Chen Chih-chung or the “Taiwan authorities.”

No explanation was given as to what had happened to the two letters the Special Counsel said it had sent, but Chen Yun-nan said he is certain the Swiss authorities will remit the money to Taiwan after the former president was convicted and given a life sentence. The official Central News Agency quoted Folco Galli, Swiss Federal Office of Justice spokesman, as saying the assets frozen can be handed over after a money laundering case is closed with the conviction of defendants.

Galli was also cited as saying the US$38 million has been frozen.

Taiwan High Court judge Teng Chen-chiu is scheduled to call President Chen to the first pretrial hearing on October 23.

President Chen is also standing trial at the Taipei District Court for embezzling a fund for secret diplomacy. He was charged with pocketing US$330,000 in petty cash during 11 diplomatic sallies in the eight years he served as president from 2000 to 2008. His National Security Council secretary-general Chiou i-jen and vice minister of foreign affairs Michael Kao were accused of misappropriating US$500,000.

Source: China Post

Taiwan court upholds ex-president's detention

Taiwan's High Court on Friday upheld its earlier decision to keep former President Chen Shui-bian in detention after the Supreme Court ordered it to hold a hearing on the matter, an official said.

The Supreme Court had questioned the High Court's contention two weeks ago that Chen posed a flight risk while he appeals his life sentence on wide-ranging graft charges.

Court spokesman Wen Yao-wen said it decided to keep Chen in detention out of concern he may still flee the island if released.

"The defendant knows about ways to escape better than ordinary people," Wen said. "As he and his family own significant assets abroad, he can still afford an affluent lifestyle overseas."

Chen's lawyer, Chen Wen-lung, said he will refile an appeal of the detention.

Chen was convicted last month of embezzling $3.15 million during his 2000-08 presidency from a special fund, receiving bribes worth at least $9 million, and laundering some of the money through Swiss bank accounts.

He has been detained in a suburban Taipei jail since December.

Chen is the first former Taiwanese president to be put on trial. He has repeatedly denied any wrongdoing and says he is being persecuted for his anti-China views by the administration of President Ma Ying-jeou, who has made improving relations with Beijing a priority.

Ma has rejected the allegation.

Chen has also argued that his detention prevented him from properly preparing his defense during his trial.

Source: AP