Prosecutors yesterday detained two people in connection with a financial scandal that has sent shockwaves through Taiwan's political system, and has even begun to affect cross-strait ties.
Chia Hsin Food and Synthetic Fiber Co (嘉新食品化纖) general manager Wang Lin-i (王令一) and Union Insurance Co (友聯產險) president Frank Wang (王事展) were held on suspicion of violating the Securities and Exchange Law (證券交易法).
The detentions came as authorities investigated the parent group of the companies, Rebar Asia Pacific Group. The Rebar Group's chairman, Wang You-theng (王又曾), fled to China on Dec. 30 with his wife, and is suspected of having embezzled millions of dollars from the group.
Lin-i is Wang You-theng's son, while Frank is his younger brother.
They were the first two people to be detained in the Rebar case.
"We found it necessary to detain the two defendants as they are suspected of having earned more than NT$100 million [US$3 million] from illegal transactions. They face more than seven years in prison." said Fred Lin (
Kuo Chi-ling (
Prosecutors are also probing whether operations in dozens of other units in the group run by family members involved irregularities such as insider trading, breach of trust and forgery.
Prosecutors have ordered about 40 members of the Wang family and the conglomerate's top executives to remain in the country pending investigation.
The scandal began to unfold after a bank run last Friday quickly turned into a wide-ranging criminal investigation into financial malfeasance.
The scandal has threatened thousands of jobs and has erased millions of dollars of wealth on the stock market.
The run on The Chinese Bank (中華銀行) began after China Rebar Co (中國力霸) and Chia Hsin Food and Synthetic Fiber, all under the parent Rebar Asia Pacific Group (力霸亞太企業集團), filed applications for insolvency protection on Dec. 29.
Wang You-theng fled to China the next day.
The firms failed to notify the Taiwan Stock Exchange Corp of their insolvency claims immediately -- as required under financial regulations -- postponing notification until last Thursday.
Approved
The companies' request to the Taipei District Court for insolvency protection was approved on the same day.
The Central Deposit Insurance Corp (
Chia Hsin Food and Synthetic Fiber is suffering from a NT$19.9 billion debt stemming from losses in its man-made fiber business.
China Rebar, an insurance, financing, broadband and TV shopping business which acts as a guarantor for Chia Hsin Food and Synthetic Fiber, has debts worth NT$20.7 billion.
The Taiwan Stock Exchange has also announced that 41 listed companies had suffered losses of NT$3.11 billion from investments in Rebar's Asia Pacific Broadband Telecom Co (
The Rebar Group employs more than 5,000 people, many of whom took to the streets to try to protect their jobs, saying that authorities' decision to freeze the assets of the two troubled firms will force employees out of work.
In related news, the Chinese Nationalist Party (KMT) yesterday announced that it would cancel Wang You-theng and his wife's party memberships. It also suspended Frank Wang's central standing committee membership.
The KMT decided that action should be taken immediately, as the scandal had damaged its reputation.
"As a responsible opposition party, the KMT made a quick and necessary decision in response to the scandal. We hope that the DPP will solve the incident and stop dragging the KMT into the Rebar scandal," KMT Spokesman Huang Yu-cheng (
Additional reporting by Mo Yan-chih
also see stories:
Premier calls on China to hand over Rebar fugitive
President asks Su Tseng-chang to conduct inquiry
Legislature likely to pass bill on debtor disclosure
Asia Pacific Telecom `on track'
CLA vows to protect Rebar employees
Banks refuse loan to Rebar-linked Eastern Multimedia
Union Insurance attempts to allay clients' concerns
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
Taiwan was ranked the fourth-safest country in the world with a score of 82.9, trailing only Andorra, the United Arab Emirates and Qatar in Numbeo’s Safety Index by Country report. Taiwan’s score improved by 0.1 points compared with last year’s mid-year report, which had Taiwan fourth with a score of 82.8. However, both scores were lower than in last year’s first review, when Taiwan scored 83.3, and are a long way from when Taiwan was named the second-safest country in the world in 2021, scoring 84.8. Taiwan ranked higher than Singapore in ninth with a score of 77.4 and Japan in 10th with
China's military today said it began joint army, navy and rocket force exercises around Taiwan to "serve as a stern warning and powerful deterrent against Taiwanese independence," calling President William Lai (賴清德) a "parasite." The exercises come after Lai called Beijing a "foreign hostile force" last month. More than 10 Chinese military ships approached close to Taiwan's 24 nautical mile (44.4km) contiguous zone this morning and Taiwan sent its own warships to respond, two senior Taiwanese officials said. Taiwan has not yet detected any live fire by the Chinese military so far, one of the officials said. The drills took place after US Secretary