BREACH OF TRUST: The former president directed and approved the sale of three media firms, resulting in massive losses for Central Investment Co, prosecutors said
By Jason Pan / Staff reporter
Former president Ma Ying-jeou （馬英九） and five other people were yesterday indicted on charges of breach of trust and contravening securities regulations in connection with the sale of three media companies owned by the Chinese Nationalist Party （KMT）.
In announcing the indictment, the Taipei District Prosecutors’ Office detailed the results of its investigation and reasons for the charges against three principal figures — Ma; Wang Hai-ching （汪海清）, former general manager of the KMT-controlled Central Investment Co （中央投資公司）; and Chang Che-chen （張哲琛）, the company’s former chairman.
Aside from contravening the Securities and Exchange Act （證券交易法）, “the three defendants also displayed disdain for the law and did not cooperate with the investigation. Prosecutors will therefore ask the court to impose the maximum sentence,” Taipei Deputy Chief Prosecutor Chou Shih-yu （周士榆） said.
Former KMT legislator Alex Tsai （蔡正元）, his wife, Queena Hung （洪菱霙）, and her father, Hung Hsin-hsing （洪信行）, were also charged with embezzlement, breach of trust, money laundering, contravening the Business Entity Accounting Act （商業會計法） and other offenses.
The case dates to Ma’s first term as KMT chairman from 2005 to 2007, when the party disposed of three key assets — Central Motion Picture Corp （CMPC, 中影）, China Television Co （CTV, 中視） and Broadcasting Corp of China （BCC, 中廣）.
Prosecutors and judicial officials have diligently worked for 12 years to investigate allegations of illegal profiteering in the sale of the three media firms, Chou said.
“Through the investigation, we have gathered sufficient evidence to build a solid case of illegal activities and breaches of the law by the defendants,” Chou said, citing as key evidence audio recording of meetings presided over by then-KMT chairman Ma, along with internal documents and other materials provided by witnesses and people connected to the case.
The formal indictments were based on new evidence collected in the past year and testimonies corroborated by witnesses, Chou said.
With Ma giving the instructions and approving the sale of the three companies below their market value, Central Investment incurred a loss of NT$3.849 billion （US$126.6 million at the current exchange rate） as a result, the indictment read.
Central Investment lost NT$1.8 billion from the sale of CMPC, NT$494.3 million from CTV and NT$1.553 billion from BCC, it said.
In addition, Ma, Wang and Chang presided over the disposal of the KMT’s old headquarters on Taipei’s Bade Road, which resulted in a loss of NT$597.13 million, prosecutors said.
The sale of BCC and its land to New Party founder Jaw Shaw-kong （趙少康） led to further losses of NT$2.845 billion, they said.
Chou released an audio recording of Ma presiding over the meetings, where a voice that sounded like Ma’s was heard directing the discussion and instructing party officials about the transaction process.
In one of the recordings Ma is heard speaking to Wang about the sale of CTV to its eventual buyer, Albert Yu （余建新）, former chairman of the China Times Group （中時集團）, before the group was purchased by Want Want Holdings （旺旺集團） chairman Tsai Eng-meng （蔡衍明） in 2008.
In the recording, Ma tells Wang to acquiesce to Yu’s demands about the financial terms and instructs him to refrain from actions that would “jeopardize the deal.”
Prosecutors said that Ma, Wang and Chang failed to uphold the trust given to them, breached accounting regulations and employed untoward business practices that resulted in losses for Central Investment and other KMT-controlled companies.