Liu Tai-ying free but not cleared

Taipei prosecutors were yesterday forced to release China Development Financial Holding Corp (中華開發) Chairman Liu Tai-ying (劉泰英) without charges, when the Taipei District Court rejected their request to continue to detain him.

The ruling came despite prosecutors' newly-voiced suspicion that he committed several counts of theft from the KMT as well as possible offences of corruption and breach of trust.

"Prosecutors failed to provide sufficient evidence that Liu might flee or destroy evidence relating to the case. In addition, he cooperated with prosecutors during the interview and answered all their questions. As a result, we did not see any need to detain him at this moment," said Taipei District Court Spokesman Liu Shou-sung (劉壽嵩).

Chen said that prosecutors may appeal to the Taiwan High Court against the decision when they receive the official ruling from the Taipei District Court, which is due within 10 days.

They could, however, summon Liu again at any time and detain him for a maximum of 24 hours, without the court's authorization.

Liu was summoned by Taipei Chief Prosecutor Lin Jinn-tsun (林錦村) on Wednesday morning because he was accused by the former Zanadau Development Corp (新瑞都) vice president Su Hui-chen (蘇惠珍), now the company's majority shareholder, of accepting a kickback, paid by her, of NT$1.06 billion.

According to Su, she paid this amount in return for Liu's promise to help her secure financing from banks, a promise which she said he did not honor.

It was the first time prosecutors had questioned Liu since Su went public with her accusations on Sept. 16. Chen said that prosecutors finally decided to summon Liu because they discovered unusual transactions in his bank accounts.

Prosecutors now think that Liu is implicated in more offences connected with his longtime role as the KMT's financial ?minence grise.

"We had decided to seek Liu's continued detention for alleged offences of corruption and breach of trust because, in addition to the allegations made by Su, we also suspect him of using the KMT's money in an authorized way," Taipei District Prosecutors' Office Spokesman Chen Hung-ta (陳宏達).

He added, "As a result of the unusual transactions we discovered in Liu's bank accounts, we now suspect him of illegal investments of KMT money in the Zanadau Development Corp, Taiwan Pineapple (台鳳), the Top Group (尖美集團) and the Powerchip Semiconductor Corp (力晶半導體) in 1998, while he was chairman of the KMT's Investment and Business Management Committee."

This means that Liu could also face charges of theft, in addition to charges of corruption and breach of trust.

From 1996 to December 1998, Liu was chairman of the KMT's business management committee. These investments, according to the prosecutors' office, were not authorized by the committee's board members and resulted in a near NT$2 billion loss for the party.

Liu was once known as the KMT's unofficial treasurer and was a close friend of former president Lee Teng-hui (李登輝). He is widely thought to have exercised ultimate control over the KMT's assets for many years during Lee's chairmanship of the party.

Other than Liu, prosecutors also summoned on Wednesday the China Development Industrial Asset Management Corp chairman Benny Hu (胡定吾), the former secretaries-general of the KMT's Investment and Business Management Committee Chien Sung-chi (簡松棋) and Darby Liu (劉大貝) as well as the secretary of the China Development Financial Holding Corp's board Lee Fang-yin (李方尹). They were all released on Wednesday. Prosecutors said they are regarding them as witnesses.