The Financial Supervisory Commission punished Taiwan International Securities Corp (TISC, 金鼎證券) yesterday for negligence in internal risk control.
The commission said it had suspended TISC chairman Lawrence Chang (張元銘) from his TISC duties or work in any securities brokerage position for a year.
The company had concentrated too much of its shareholder investments — 46.7 percent — in Unitech Printed Circuit Board Corp (燿華電子), Fulltech Fiber Glass (富喬工業) and Ideal Bikes (愛地雅), which accounted for 60 percent of its outstanding losses, the commission said.
Unitech and Ideal are both chaired by Chang’s father, Chang Ping-chao (張平沼).
During a routine financial supervision review last September, the commission found that TISC had failed to look after the interest of its shareholders in the management of the repurchase agreements for its structured note investments and its oversight in supervising its overseas subsidiary, Chang Li-jen (張麗真), deputy director-general of the commission’s Securities and Futures Bureau, told a media briefing.
Under the Company Act (公司法), it is up to TISC to determine whether it will replace Lawrence Chang with a new chairman or appoint an acting chairman during his suspension.
FSC chief secretary Lu Ting-chien (盧廷劼) said TISC’s punishment was a routine regulatory review and had nothing to do with the recent management dispute between TISC’s management team, led by the Changs, and a management team from China Development Financial Holding Co (中華開發金控), the company’s biggest shareholder.
“The commission has no intention of meddling in their dispute,” Lu said.
The dispute may end up in court as both parties have threatened to take legal action.