Sat, Sep 27, 2014 - Page 3 News List

Hospital group accused of fraud

BREACH OF TRUST:It is alleged the Show Chwan group set up a firm to buy cheap drugs, which it sold on at high prices in its hospitals, and defrauded the NHI scheme

By Jason Pan  /  Staff reporter

Show Chwan Healthcare System chief executive Huang Ming-ho arrives at a court hearing over alleged fraud in Changhua County yesterday. Huang attempted to cover his handcuffs with a blue piece of cloth.

Photo: Yan Hong-chun, Taipei Times

Top executives at Changhua County Show Chwan Healthcare System have been questioned in a judicial investigation in connection with an alleged fraud that is said to have netted the perpetrators up to NT$400 million (US$13.2 million) in a scheme to fix prices of drugs and embezzle government subsidies.

After questioning by prosecutors, Show Chwan chief executive officer Huang Ming-ho (黃明和) was released yesterday after bail of NT$13 million was posted, while his daughter, Huang Yi-ting (黃意婷), was released on bail of NT$5 million.

The Show Chwan Hospitals Group operates seven hospitals around Taiwan, including in Taipei, Changhua City, Greater Tainan, and Greater Kaohsiung.

The group’s deputy financial chief Hu Yu-mei (胡毓美) was also released yesterday, on bail of NT$1 million.

The Changhua District Court rejected prosecutors’ request to detain the three executives, instead granting them bail, after the trio were taken in on Thursday for overnight questioning in an operation mounted by the Ministry of Justice’s central Taiwan office of the Investigation Bureau.

A total of 32 individuals, mostly Huang’s family and relatives, along with Show Chwan executives, were questioned during the ongoing judicial probe.

Huang Ming-ho was an independent legislator for Changhua County from 1987 to 1993, and later won an election running for the Chinese Nationalist Party (KMT) serving a term from 1999 to 2002.

He is accused of setting up a company in 2010 under a nephew’s name to buy medicine in bulk at discounted prices. The company then allegedly resold the medicine to Show Chwan and its hospitals at full prices.

The profits from the differences in price, estimated at more than NT$400 million in the past four years, were transferred into Huang Ming-ho’s personal bank accounts, and those of his wife and children, according to prosecutors.

In addition to drugs, the scheme also included hospital medical equipment and healthcare accessories, prosecutors said.

Huang Ming-ho and the group executives are also accused of defrauding money from government subsidies paid to doctors and patients under the National Health Insurance (NHI) scheme.

Prosectors said the profits were used by Huang Ming-ho and his family to purchase a number of real-estate holdings and luxury condominiums in Greater Taichung and other places around central Taiwan.

When facing the media upon his release yesterday, Huang Ming-ho proclaimed his innocence.

“You all know me and my business. All my dealings have always been clean and law-abiding,” he said.

However, prosecutors said they have enough evidence to charge Huang Ming-ho and other suspects for embezzlement, breach of trust, and other violations.

It was also reported that prosecutors have uncovered several bank accounts, belonging to Huang Ming-ho and his family, with “unusual transactions,” and have frozen one of the accounts, which contained an amount of more than NT$100 million.

Additional reporting by CNA

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