Taipei prosecutors yesterday charged six executives of Lilly Real Industrial Co with financial fraud, after more than 100 people allegedly lost more than NT$600 million (US$20.78 million) to its investment schemes over the past four years.
An investigation showed that the Taipei-based company was founded in 2016 by a couple — Hsu Heng-jui (許恒瑞), 53, and Fang Hsin-yi (房欣怡), 38 — along with two other family members and a business partner, Chiang Yu-chiao (江玉嬌).
On July 17, prosecutors and police searched the company’s offices and other locations after receiving complaints from people about financial fraud, and summoned the six for questioning.
Hsu and Fang, as the main proprietors, were denied bail and have been in detention since then.
Prosecutors said that one of the investment schemes involved Hsu and Fang asking potential investors to take out a mortgage loan.
Once they have received the mortgage money, the couple would ask them to sign a five to seven-year agreement in which they would hand the money over to Lilly and earn a monthly interest rate of 1 to 3 percent, prosecutors said.
Another scheme involved Lilly acting as a loan broker, with Hsu and Fang helping people take out bank loans by providing dubious credit documents and financial papers.
Again, money from the loans were given to the firm in exchange for 1 to 3 percent in monthly interest income, prosecutors said.
The investigation found that Hsu, a former New Taipei City police officer, had used his connections with police and government agencies to attract civil servants and school teachers to the firm’s financial schemes from 2016 to April this year.
After attracting about a dozen of investors at the start, Hsu and Fang paid out interest rates of 1 to 3 percent until about 2018.
However, as more people joined up, Lilly began to default on payments, leading several disgruntled investors to file complaints.
Prosecutors said that most of the NT$600 million Lilly took in came from 15 investors, while the rest came from smaller investments made through its “loan broker” scheme.
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