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Liu's release presents dilemma

Former China Development Holding Corp chairman Liu Tai-ying's (劉泰英) release on bail next Monday will be crucial for acting chairwoman Diana Chen's (陳敏薰) position because it is not known whether Liu will resume his post.

Since Chen became acting chairwoman in February, she is reported to have successfully become the majority shareholder of the company by purchasing stocks from minority shareholders.

In addition, she also joined the Ketagalan Academy.

This was speculated to be a move to establish political links to the ruling party in an attempt to save her job.

When approached by reporters yesterday, Chen said the decision of her continuing to lead the company is up to the Ministry of Finance, which is the company's superior authority, as well as the company board.

"When Liu is released on Monday, technically, he will immediately resume his position. However, it is also possible that the ministry decides to relieve him if he is indicted. It is not only my call," she said. "However, personally, I still hope that Liu can re-join us and continue to lead the company as usual."

According to Chen, if the ministry decides to relieve Liu, the company's board meeting will have to select a new leader from the board members but no meeting date has yet been set.

Liu has been detained since Feb. 10 this year for his involvement in the Zanadau Development scandal. He was accused of accepting a NT$1.06 billion kickback from Zanadau's majority shareholder, Su Hui-chen (蘇惠珍), who was then-vice president of the company, in return for a promise to help her secure bank financing back in 1995.

However, during the investigation into the scandal, prosecutors discovered from Liu's bank transactions that he also allegedly misappropriated KMT assets to invest in different companies or use as mortgages for personal purposes.

Liu was at the time chairman of the KMT's Business Management Committee during former president Lee Teng-hui's (李登輝) presidency.

In addition, Liu is reported to have told prosecutors during previous interrogations that Lee had transferred NT$290 million to his bank account, saying the money was campaign donations from his supporters for the 1996 presidential election.

He is alleged to have told prosecutors that Lee asked him to "invest the money for his personal benefit."

However, prosecutors did not discover any tax reports from Lee regarding these investments.

According to the Criminal Code, the maximum detention period is four months. As a result, prosecutors will have to release Liu on bail on Monday whether they want to indict him or not.

If indicted, Liu faces possible charges of theft, corruption, embezzlement, breach of trust, violating the Securities Transaction Law (証券交易法), document forgery and violating corporate law.

Liu was once known as the KMT's unofficial treasurer and was a close friend of Lee. He is widely thought to have exercised ultimate control over the KMT's assets during Lee's presidency and chairmanship of the KMT.
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