Tue, Dec 21, 1999 page8

• Soong's statistics do not compute

  • Chen Po-chih
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  James Soong said the funds in his son's account was entrusted to him by President Lee Teng Hui (李登輝) to take care of the surviving family members of the late president Chiang Ching-kuo (蔣經國). But President Lee's aide Su Chih-cheng (蘇志誠) and many other people believe the money is Soong's stolen loot.

  Most people cannot verify either of these stories. Therefore, many people may not be able to figure out who is in the right.

  Fortunately, there is a statistical, scientific method which allows us to infer unseen matters from known phenomena.

  Take, for example, a bag of stones. Some could say most of the stones inside the bag are white, while others could say most are black.

  Even if we cannot open the bag and see all the stones, we can still infer which side is more likely to be correct.

  If we take out 20 stones and they are all black, then we might conclude that most of the stones in the bag are black.

  Because if half or more of the stones in the bag are white, then there is less than one-in-a-million chance for all the 20 stones taken out to be black.

  If the money was entrusted to Soong by Lee, then its disbursement should have been countersigned by several people, just like the money for Chiang Hsiao-wu's (蔣孝武) family.

  It should not be disbursed at will by Soong.

  However, if the money was embezzled, then of course no account would be set up to be countersigned by other people.

  If the money was entrusted, the account should have been independent and not lumped together with Soong's own money.

  However, if it was embezzled, then it would of course be merged into a family account.

  If the money was entrusted, and even if the money was deposited in a family account for some reason, then it should have been deposited in one account, not two.

  However, in the case of an embezzlement, separating the deposits would lessen the chance of being caught.

  If the money was entrusted, complete details of the account should be available. Soong should not have needed six days to scramble for details.

  If Soong already saw the money as his own, then there would be no need to try to distinguish between his money and the entrusted funds.

  If the money was entrusted, then the entrusted matter should have been carried out and there should have been expenditures.

  Even if he was only using the interest on the funds, this would still be close to NT$10 million.

  However, there is no proof that any of the money wsa spent.

  Soong's camp said no payouts mean no embezzlement.

  But if it was a case of embezzlement, why should we have to wait until the the money was spent to qualify it as embezzled?

  If the money was entrusted, Soong should have handed over the money when he changed jobs.

  But in the case of an embezzlement, he would not need to hand the funds over.

  If the money was entrusted and if Soong had wanted to return it, then he could have done so by wire transfer. There was no need for a withdrawal.

  If Soong wanted to return the money after it was withdrawn, then he could have mailed it or delivered it to the door.

  There was no need to keep it.

  If Soong wanted to return the money to Lee in person, he should have made an appointment instead of doing nothing.

  If the money was entrusted, then there would be no income from the interest after the money was withdrawn, and the late president's widow would lose the support she was supposed to be getting while President Lee believed Soong was still taking care of her.

  How could Soong have brought himself to do such a thing?

  If Soong needed to withdraw the money and return it, then he could have just arranged for a cashier's check from the Bank of Taiwan.

  There was no need for a large number of checks.

  But if the money had been prepared for vote-buying, then a large number of checks would be needed to ensure convenience and safety.

  If the money was entrusted, then Soong would have remembered it.

  He would not have needed to ask his wife about it.

  But if Soong had appropriated the money for himself, then his wife would, of course, take care of the family's finances.

  If the money was entrusted, and if Soong was unwilling to tell the truth about it, then he could have said the money had been entrusted to him by a friend.

  He would not have needed to say the money was an elder's gift to his son.

  If money had been entrusted to him to be returned at a later date, he would not have needed to say the elder had taken the money back, while in fact it was Soong himself who had withdrawn the money.

  The above 14 items -- which either were said by Soong himself or we have been able to see for ourselves -- all are unlikely to have happened if Soong was sincerely trying to help President Lee and the Chiang family.

  If we assume that Soong has been sincere and that to make mistakes is but human nature -- and given the one-in-five probability of making a mistake each time -- the probability of making 14 mistakes in a row is one in six billion.

  Even if we raise the probability for each item to one-in-three, the probability of making 14 mistakes in a row is one-in-4.78 million.

  In other words, if what Soong said at the press conference was true, then the probability of the above-mentioned 14 items is almost zero.

  However, these 14 events have occurred.

  Therefore, from a statistical point of view, Soong's words are not credible.

  On the contrary, the whole affair fits very well with the assumption that Soong embezzled the money.

  Chen Po-chih is a professor of economics at the National Taiwan University.
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