A hearing held yesterday by the Ill-gotten Party Assets Settlement Committee to determine whether the Minsheng Development Foundation was affiliated with the Chinese Nationalist Party (KMT) ended in a stalemate after the KMT cited difficulties locating key data regarding the foundation’s operations.
A preliminary investigation by the committee discovered that the foundation — established in 1978 with NT$10 million (US$317,128 at current exchange rates) donated by the KMT “to promote Sun Yat-sen’s (孫中山) Three Principles of the People” — donated NT$1.2 billion to the party between 1992 and 1995.
Foundation employee Lee Chung-hua (李中華), who is also a KMT employee, on Nov. 1 and Nov. 2 last year withdrew a total of NT$94 million from Bank SinoPac and Hwatai Bank, the investigation found.
Hsinyutai Co, a holding company determined by the committee to be a KMT affiliate, in December 2015 subsidized the foundation NT$90 million, it showed.
The post of the foundation’s president has almost always been taken by the KMT Administration and Management director or other KMT executive, while its directors have always been KMT employees, the probe found.
Citing the foundation’s balance sheet, committee Vice spokeswoman Shih Chin-fang (施錦芳) asked foundation representatives to explain the large disparity between cash donations the foundation had made to a number of educational and social welfare advocacy groups, numbered in several thousand New Taiwan dollars, and “public service offices” operated by local government-level pro-KMT politicians, which ranged from NT$1 million to NT$1.5 million.
Committee Chairman Wellington Koo (顧立雄) asked foundation representatives whether the KMT pays the rent for the foundation’s offices on Bade Road (八德路) in Taipei.
He asked KMT Administration and Management Committee director Chiu Da-chan (邱大展) whether he instructed Lee to withdraw the money and how it has been used.
Saying Chiu and the foundation’s directors assumed office only a couple of days after the KMT elected Chairwoman Hung Hsiu-chiu (洪秀柱) in May last year, Koo asked Chiu whether he was appointed president by Hung.
Attorney Yeh Ching-yuan (葉慶元), who represents the foundation, said the sum donated by the KMT in 1978 was insignificant compared with the donations the foundation has received over the past 10 years, which totaled NT$357 million, adding that the capital used to establish the foundation was from legitimate sources.
The foundation cannot be regarded as a KMT affiliate because it manages its finances independently, and its president and directors are not appointed by the party, but through elections held by its board of directors, Yeh said.
The foundation’s annual expenditure is authenticated by accountants and checked by the Ministry of Health and Welfare, he said, adding that the committee would be “slapping the ministry in the face” if it raised doubts about the legality of the foundation’s spending.
Attorney Chang Shao-teng (張少騰) said the foundation was established to serve the public interest and it does not fall within the scope of the “party affiliates” Koo’s committee was established to tackle.
He dismissed Shih’s question as to why donations the foundation had made to public service offices had been larger than those it made to other groups, adding that campaigning for public office is a means to further the public interest.
He said the KMT would have to locate its ledgers before it could tell why it requested a subsidy of NT$1.2 billion or whether it has been paying the foundation’s rent.
However, Chiu said the party probably would not be able to find the ledgers compiled more than 20 years ago.
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