Lawmakers plead innocent to fraud

KMT Legislator Gary Wang (王令麟), and independent legislator Tsai Hau (蔡豪) pleaded not guilty on charges of fraud relating to two land deals before the Taipei District Court yesterday.

Eleven defendants were also called at the committal proceedings yesterday to state whether they had been involved in the multi-million land deals -- one made in 1998 and the other in 1999.

Informed of the charges against him -- breach of trust, forgery and tampering with accounting records -- Wang, chairman of Eastern Multimedia and also chairman of the General Chamber of Commerce of the ROC (中華民國全國商業總會) insisted that the transactions of the disputed land conformed to standard legal business practices and said he was confident the court would "find him innocent."

The heir to the Rebar Group denied that he had inflated the price of a plot of land in Yangmei township, Taoyuan County, and obtained millions of dollars in under-the-table profits through the resale of the land, measured approximately 75,000m2.

Tsai, also appearing in yesterday's pre-trial procedure, denied the allegations that he had helped facilitate the land transactions between Wang's company and the state-run Taiwan Development and Trust Corp (TDTC, 台開).

Tsai, who plans to run in the December legislative elections, also urged the presiding judge Chu Meng-ping (朱夢蘋) to hear the case speedily for fear that the pending charges would obstruct his re-election bid.

Chu did not respond to Tsai's request.

Prosecutors from the Taipei District Prosecutors' Office said that the case involved two stages: the sale and then the purchase of land in Yangmei. During each stage, under-the-table deals between the two sides inflated the price of the land to create illegal profits.

According to prosecutors, the listed Far Eastern Silo and Shipping (FESS, 遠倉), of which Wang is chairman, purchased the land from Chu Chieh-tseng (朱介曾) for NT$845 million in 1998, a price higher than the value of the property at the time. Chu had allegedly bought the land in 1995 for NT$500 million.

The prosecution said that around NT$189 million of the price difference found its way through several dummy accounts into the accounts of another company owned by Wang. Chu's company also made NT$55 million from the artificially raised price.

The prosecution said this was a conspiracy in which Wang, Chu and two others squeezed money out of FESS and its shareholders. FESS intended to build a villa complex on the land, but due to the continuing decline in real estate prices, Wang then sought, after partially developing it, to sell it off for NT$1.8 billion to the state-run TDTC, also a listed company.

According to the indictment, Wang asked his close aide Chou Chi-peng (周繼鵬) to forge purchase records relating to the land and to manipulate a real estate valuation company to inflate the real price of the land.

Wang then asked Tsai Hau a board member of TDTC and Kao Chien-wen (高建文), the vice chairman, to push the board to make a decision to buy the land in November 1999. The move came hot on the heels of a report conducted by TDTC only a month earlier which concluded that such an investment was not worthwhile.

The prosecution has asked for a jail term of four years, 10 months for Wang and three years for Tsai. The trial is scheduled to begin on July 18.