Chen's in-laws jailed for insider trading

President Chen Shui-bian's (陳水扁) son-in-law Chao Chien-ming (趙建銘) was sentenced to six years in jail yesterday by the Taipei District Court, while Chao's father, Chao Yu-chu (趙玉柱), received eight years and four months in jail.

The Chaos were found guilty of insider trading in connection with the Taiwan Development Corp scandal and other illegal deals.

The father and son were also fined NT$30 million (US$927,000) each.

The Chaos and other defendants may appeal the ruling to the Taiwan High Court.

In its ruling yesterday, the Taipei District Court said: "They used their political influence to intervene in big business and political affairs. Illegal lobbying and insider trading were the methods they used."

They had shown no regret for their actions and heavy sentences were appropriate, the ruling said.

Chao Yu-chu embezzled NT$11 million from Eslite Books chairman Robert Wu (吳清友), who deposited the sum into one of Chao Yu-chu's bank accounts as a donation to the Taiwan Table Tennis Association, which was headed by the senior Chao, and who had exclusive access to the account.

Former Taiwan Development Corp chairman Su Teh-jien (蘇德建) and a businessman, Yu Shih-yi (游世一), were sentenced to four years and three months in jail. Yu was also fined NT$60 million.

Waterland Securities Co board director Tsai Chin-wen (蔡清文) was sentenced to two years in jail, but this was suspended because he had pleaded guilty and turned witness for the prosecution.

Chao Chien-ming, Chao Yu-chu, Su, Tsai and Yu made more than NT$10 million through insider trading of TDC shares.

The scandal dates back to last summer when Su, Chang Hwa Commercial Bank chairman Chang Po-shin (張伯欣) and bank president Chen Chen-chao (陳辰昭) dined on two occasions with Chao Chien-ming, Tsai and Yu at a Japanese restaurant in Taipei.

Confidential information about Taiwan Development Corp was discussed on both occasions.

The court noted that Chao Chien-ming, his father, Tsai and Yu each bought a large number of shares in the corporation shortly afterwards.

In related news, Nice Group president Chen Jing-yao (陳鏡堯) was sentenced to two years in jail, and one of the company's managers, Hung Min-sen (洪敏森), was sentenced to one year and six months.

Chen and Hung were found guilty of breach of trust in connection with the transfer of NT$27 million to Chao Yu-chu's accounts.

Prosecutors believe that the money was a bribe for Chao Chien-ming's efforts to help Chen Jing-yao win the leadership of Waterland Financial Holdings Co last year.

The court found that there was insufficient evidence that the Chao family attempted to manipulate that leadership race, and thus neither were charged on that count.

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Reaction mixed to convictions of Chen's in-laws