Sun, Nov 19, 2000 - Page 1 News List

KMT legislator gets 12 years for embezzling

COURT CASE The Pingtung District Court found Kuo Ting-tsai guilty of forging documents and siphoning off NT$2.3 billion from a co-op to invest in stocks


KMT Legislator Kuo Ting-tsai (郭廷才) was found guilty of embezzling over NT$2.3 billion from a Pingtung credit cooperative and sentenced to 12 years by the Pingtung District Court yesterday.

Kuo, who was chairman of the Tungkang Credit Cooperative (東港信用合作社) in Pingtung County since 1992, was forced to step down last year as the Pingtung Prosecutors' Office began investigating financial irregularities at the cooperative.

Kuo, 63, was found to have instructed the cooperative's staff to doctor account books and forge certificates of deposit, and to have removed NT$2.3 billion from the cooperative since April 1996.

The court found that Kuo then diverted the money to the Fahua Securities Investment Trust Co, where he served as chairman between May 1996 and January 1997, to invest in the stock market. But the company itself was also a victim as Kuo had tampered with the company's certificates of deposit and used them to borrow money from the Tungkang cooperative during the period.

The court found that after his departure from the company, Kuo's son, Kuo Chia-cheng (郭佳誠) took over and managed to cover up Kuo's fraudulent acts. The junior Kuo also used the company's name to borrow nearly NT$200 million from the Tungkang cooperative, which the court found had finally fallen into the KMT legislator's dummy accounts.

The scandal came to light last July when investigators at the Central Deposit Insurance Corp (中央存款保險公司) discovered staff of the cooperative had tampered with its daily deposit balance and had also forged account statements at the Taiwan Cooperative Bank (台灣省合作庫).

Following disclosure of the scandal last year, the Tangkang co-operative became victim of a bank run when many of its customers withdrew their funds, and was taken over by the Bank of Taiwan.

The Kuos, along with Hsu Shu-chin (許淑卿), the credit cooperative's accountant chief, and another eight employees were indicted on charges of breach of trust, fraud and forgery last September.

During the investigations, Kuo went into hiding to dodge questioning by prosecutors between legislative sessions. When the session began, he used legislators' immunity from arrest to protect himself from prosecutors.

During the trial, the legislator did not answer the court's summons until his son was ordered to be detained by the district court.

The district court sentenced Kuo to 12 years yesterday, while his son was sentenced to one year and two months. The cooperative's chief accountant was given 11 years and 10 months and another eight of the cooperative's accountants were given sentences ranging from one year to five years.

Kuo and the others can appeal to a higher court and his legislative office will not be affected until his conviction is confirmed by the Supreme Court.

Apart from embezzlement, the KMT legislator is also being tried for a land-rezoning case, in which he has been accused of graft when he was a member of the Pingtung County Urban Planning Committee between 1989 and 1992.

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