SinoPac Financial Holdings Co (永豐金控) senior vice president Michael Chang (張晉源) yesterday said that the company’s filing of a lawsuit against him on Monday was an attempt to defame him and punish him for exposing a corporate scandal several years ago.
Subsidiary Bank SinoPac (永豐銀行) in 2016 sold its US unit, Far East National Bank (FENB), to Cathay General Bancorp for US$353 million.
The bank on Monday said that the sale was a “dubious transaction” and accused Chang, who was the bank’s president at the time, of deliberately concealing part of FENB’s assets, valued at US$69.28 million, from its board of directors.
Denying the allegations, Chang said that he had disclosed all of FENB’s financial information to the board, which had to review all financial statements before they were published.
SinoPac Financial also said that Chang had breached internal regulations by asking employees to use private e-mails for communication about the sale.
Chang said that it was standard practice at Sinopac to use private e-mail for communication about mergers and acquisitions to maintain confidentiality.
He added that former SinoPac Financial chairman Ho Shou-chuan’s (何壽川) secretary followed the same practice.
As for SinoPac Financial’s query as to why Chang demanded that the bank and Cathay General Bancorp hold board meetings on July 8, 2016 — when work was canceled because of a typhoon — Chang said both were public companies and they needed to hold board meetings and announce the deal on the same day.
He said that he did not deliberately choose a typhoon holiday to hold the meetings as he did not know there would be a storm when he scheduled it for that day.
He added that Ho also insisted that the meeting be held that day, even when a typhoon warning had been issued.
Moreover, Bank SinoPac’s board meeting was convened by former bank chairman Yu Kuo-chih (游國治) and Ho, who did not attend the meeting, but asked board members to support the deal, he said.
In the lawsuit, SinoPac Financial accused Chang of a breach of trust and contravening the Financial Holding Company Act (金融控股公司法) and the Banking Act (銀行法).
While SinoPac Financial has suspended Chang from his current post, it continues to pay him his wage until the court reaches a decision.
The lawsuit has raised questions about whether Chang’s right to work should be protected under whistle-blower rules.
The Financial Supervisory Commission told a news conference yesterday that Chang’s rights are not protected under the whistle-blower protection rules, because he is facing allegations relating to the disposal of the US unit, which is different from the case wherein he served as a whistle-blower.
Chang was in 2017 instrumental in exposing Ho for facilitating dubious transactions and loans between SinoPac’s business units.
Ho was removed as chairman as a result.
The bank cannot dismiss Chang until the ruling is announced, Banking Bureau Deputy Director Sherri Chuang (莊秀媛) said.
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