Two Taiwanese fund managers suspected of making personal fund investments after being entrusted to handle the investments of labor pension funds were indicted by the Special Investigation Division (SID)
October 18, 2013 Leave a comment
SID indicts fund managers on insider trading, costing government NT$3.8 billion
By Katherine Wei,The China Post
October 17, 2013, 12:03 am TWN
TAIPEI, Taiwan — Two fund managers suspected of making personal fund investments after being entrusted to handle the investments of labor pension funds were indicted by the Special Investigation Division (SID) yesterday. Former JihSun Funds (日盛投信) manager Chen Ping (陳平) and former Yuanta Funds (元大寶來投信) manager Chu Nai-cheng (瞿乃正) were accused of buying stocks under the names of relatives, friends and employees when they were responsible for investing in the nation’s labor pension funds. After Chen and Chu secured a large amount of stocks in the market, they introduced the pension funds and sold their private stocks when the prices rocketed, allegedly benefiting enormously from the procedure.According to the SID, the two men had charted a false analysis of their stock investments which included inaccurate information. Chen received over NT$56 million and Chu earned over NT$14 million, at a total cost to the government of NT$3.8 billion.
The SID asked the court to hand out heavy sentences to both men, and called for larger fines as well. “Their acts are despicable,” said the SID official in charge.
Investigators discovered that Chen and Chu applied for loans in order to buy more shares; their habit of buying stocks even during periods of rising share prices — highly unusual in the market as investors tend to buy after stock prices drop — also registered as suspicious.
Both Chen and Chu admitted to having made fund investments under the names of many other individuals, but denied involvement in insider trading. The men also claimed that the stocks included in the analysis had been chosen by their companies during firm conferences, and that they had no part in the decisions.
The Executive Yuan’s Labor Pension Fund Supervisory Committee announced that it will take remedial actions upon receiving notification from the SID, and will demand full compensation by the accused fund managers.
The SID has confiscated NT$300,000 in cash, NT$28 million in stocks and bank savings from Chen, NT$6.93 million in cash and a house from Chu.
A total of 52 people were subpoenaed for the case, with the bill of indictment adding up to a massive 507 pages, said the responsible prosecutors.
About bambooinnovator
Bamboo Innovator 