Home appliance maker Taiwan Kolin Co (歌林) yesterday denied rumors concerning an alleged embezzlement scheme a day after prosecutors raided its offices, saying the company was only encountering financial difficulties.
Kolin spokesman Hu Cheng-fa (胡成發) said the company’s financial troubles were triggered by its inability to collect accounts receivable from Syntax-Brillian Corp, which is a US TV and digital camera maker with indirect investment from Kolin.
It is understood that among Kolin’s NT$10.69 billion (US$318 million) accounts receivable, NT$5.94 billion should be from Syntax-Brillian.
But as the company has applied for bankruptcy protection, it temporarily suspended its payments to Kolin, the Chinese-language Liberty Times reported yesterday.
In addition, local banks have shrunk the amount of money that can be borrowed at this crucial moment, which led Kolin to run into cash flow problems and bounce its checks, Hu said.
However, Hu stated that the company had submitted its debt claim to the US court for nearly NT$6 billion.
Hu’s remarks came after prosecutors raided the headquarters of Kolin on Wednesday amid speculations that several Kolin officials, including its chief executive officer Liu Chi-lieh (劉啟烈), were alleged to have embezzled several billions of dollars from the Taipei-based company.