The Taipei District Prosecutors’ Office yesterday announced the indictment of two people it said were key figures in a 2015 financial scandal involving takeover bids by integrated circuit design giant MediaTek Inc on charges of insider trading and other offenses.
Prosecutors said they indicted Cheng Chieh-cheng (鄭捷丞) — the ex-husband of former Richtek Technology spokeswoman Yao Huan-wei (么煥維) — and MediaTek deputy manager Chen Wen-lin (陳文淋) over breaches of the Securities and Exchange Act (證券交易法).
Using knowledge of MediaTek’s takeover plans, Chen allegedly profited by about NT$2.16 million (US$70,604 at the current exchange rate) through stock manipulation, while Yao reportedly profited by about NT$1.74 million by passing information to Cheng.
The case stemmed from MediaTek’s acquisition of Richtek, Alpha Imaging Technology, Chingis Technology and Ilitek in 2015.
MediaTek used investment unit Hsu-Si Investment Corp to acquire Richtek.
The handling of the acquisition was highly touted in the financial industry, earning MediaTek three honors, including the Taiwan Mergers & Acquisitions’ and Private Equity Council’s Merger and Acquisition award for outstanding achievement.
MediaTek on Sept. 7, 2015, announced the deal, worth about NT$30 billion, in which it proposed to buy Richtek shares at NT$195 each, with the process to be completed by the second quarter of last year.
The Ministry of Justice’s Investigation Bureau received tip-offs that Yao and Chen had been privy to inside information, and that Yao told her ex-husband to establish accounts to buy Richtek shares from August to Sept. 6 to profit from an expected rise in share prices.
The bureau’s investigation reportedly uncovered insider trading activity by Chen, who set up his own accounts during the acquisition process.
Authorities in February raided 10 offices and questioned 13 people in connection with the investigation.
At that time, travel restrictions were imposed on Chen and Cheng, who were released on bail of NT$1 million and NT$1.5 million respectively.
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