In February, the New York State Department of Financial Services said in an in examination report that there were a number of serious deficiencies involving a couple of overseas branches of Mega International Commercial Bank. The report pointed to suspicions of money laundering at the bank’s Panama branch, a lack of adequate auditing of clients and internal control deficiencies between the New York branch and the bank’s headquarters.
Despite the bank’s efforts to answer the accusations of violations of bank confidentiality laws and money-laundering laws, the department fined it US$180 million.
In Taiwan, in the seven years since the Money Laundering Control Act (洗錢防制法) was implemented on June 10, 2009, what exactly has it achieved? How much have individuals or companies been fined for breaches of the law or for money laundering? Why were Mega Bank’s transgressions discovered by US authorities, while the authorities here in Taiwan had to be informed of the problems?
One does have to ask, if a similar case occurred in Taiwan and it fell to the local authorities to handle it, would they be able to get the perpetrators to admit guilt? And how much would the miscreants have been fined?
A major spill at a Formosa Ha Tinh Steel Corp plant in Vietnam caused a mass fish kill along the nearby coast, triggering major protests that lasted for weeks. Despite the company’s protestations of innocence and insistence that the disaster had not been caused by the plant’s waste effluent, its account was not accepted by the Vietnamese government and in June it was fined US$500 million to compensate those affected.
The Vietnamese authorities subsequently discovered a large amount of waste illegally buried on a farm in Ha Tinh Province. Formosa Ha Tinh tried to blame a local contractor, whom it said failed to process the waste according to regulations. Yet it is facing a significant fine.
In Taiwan, Formosa Plastics Group’s naphtha cracker complex in Yunlin County’s Mailiao Township (麥寮) has allegedly given rise to an extremely high incidence of cancer in nearby residents, as well as a dying-off of farmed oysters, but there has been no compensation because of the difficulty in establishing the link between pollution and cancer.
There is a precedent to this. In 2002, 8,238 tonnes of mercury-contaminated sludge was found illegally buried in Pingtung County’s Chihshanyan (赤山巖) and the waste handler, Yuntai, admitted that it was of the same kind of waste that it had transported from Formosa Plastics.
Not only did the government fail to secure compensation from Formosa Plastics in the case, it even lost a further NT$150 million commissioning the company’s petrochemical plant in what was then-Kaohsiung County’s Renwu (仁武) to process the waste, a plan that was only abandoned when Renwu residents protested.
Taiwan is an orphaned state, plagued with all kinds of problems. One of these is procuring military weapons.
For example, it costs our government more than five times what Australia and Singapore pay to buy minesweepers, which is surely difficult to justify.
The Lafayette frigate bribery scandal was a real eye-opener for many Taiwanese, too: Not only did both sides of the deal receive kickbacks for the purchase, but even China, a third party, received a cut.
In France, the money disappeared into undisclosed pockets. In China, the bribes evaporated into thin air. In Taiwan, several of the people involved in the scandal came to a sticky end, either being murdered or committing suicide. The only people caught were the dealers.
Then there was the political assassination of US-based journalist and author Henry Liu (劉宜良), known by his pen name, Chiang Nan (江南). Not one of the perpetrators evaded the US authorities, not even the mastermind acting behind the scenes.
And then there is Taiwan. We are still waiting for the murders of democracy activist Lin I-hsiung’s (林義雄) mother and twin daughters, and of Chen Wen-chen (陳文成), to be solved. It has been about 35 years since those killings.
Do not hold your breath.
Money laundering, pollution, military procurement bribery and political assassinations: Why is it that foreign governments can get to the bottom of these crimes, and our own government cannot?
Chang Kuo-tsai is a retired associate professor of National Hsinchu University of Education and a former deputy secretary-general of the Taiwan Association of University Professors.
Translated by Paul Cooper
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