Taipei prosecutors yesterday indicted Wang Hui-ying (王橞瀴), a business operator in Taiwan’s garment industry for allegedly defrauding Taiwanese banks of NT$13.4 billion (US$478.83 million).
Wang and the owner of Chin Chin Accounting Services, Lin Shu-ling (林淑玲), along with three accountants working at the firm, were charged with fraud, contravening the Banking Act (銀行法) and the Business Entity Accounting Act (商業會計法). They are accused of fabricating invoices, business documents and other papers, allegedly enabling them to take out loans from 25 banks and four private money-lending companies.
According to prosecutors, Wang owns Fortune Fashion Ltd and Joy Honest Ltd, both registered in Taipei and among Taiwan’s leading clothing manufacturers. She owns two companies supplying new fashions to major department stores in Taiwan, with manufacturing factories in China.
Photo: Chien Li-chung, Taipei Times
The case is reportedly one of the largest financial frauds in Taiwan, following the 2019 New Site Industries (潤寅實業) case, in which the principal figures were said to have orchestrated fraudulent business schemes that saddled nine Taiwanese banks with losses of NT$38.6 billion.
A judicial probe was initiated in October last year, with Taipei prosecutors coordinating with Ministry of Justice Investigation Bureau units to raid seven locations, detaining Wang, Lin and others for questioning on financial irregularities and their companies’ accounting records.
After questioning, Wang and Lin were released on bail of NT$1 million and NT$2 million respectively on Oct. 28 last year, while an accountant working at Fortune Fashion, along with two accountants surnamed Chou (周) and Lee (李) at Lin’s firm, were also released.
Prosecutors in yesterday’s indictment said that Wang was the primary organizer of the scheme, allegedly seeking Lin’s help in colluding on financial fraud. The two are said by prosecutors to have worked together to create 17 shell companies that were fraudulently registered in other countries.
The duo allegedly used these fake overseas companies for false transactions, with 13 of them made to appear as downstream customers purchasing bulk fashion wear and clothing items, and four of them upstream suppliers, for which forged business invoices, receipts and financial statements were provided, prosecutors said.
It is alleged by prosecutors that from these fabricated documents that Lin and her accountants generated fake company accounting records and financial reports, creating false scenarios of strong international trades and robust business activities with fabricated sales figures for Wang Fortune Fashion Ltd and Joy Honest from 2012 to 2017.
From these accounting records and financial reports, Wang was allegedly able to take out loans to cover business losses at her companies for NT$13.4 billion, which resulted in non-recoverable bad loans for their banks, prosecutors said.
Those banks that allegedly failed to undertake due diligence and proper checks, and were left with large losses, include the Bank of Taiwan, First Commercial Bank and Chang Hua Bank, according to the indictment.
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