Stop the presses! Taiwan corruption
scandal! By Laurence
Eyton
TAIPEI - In the closing days of Taiwan's
presidential election campaign, corruption has become a
big issue. Both sides are dogged by corruption
allegations that have been the staple of seemingly
endless TV political talk shows. The problem with the
most talked-about allegations is working out just what
is supposed to be so scandalous.
The ruling
Democratic Progressive Party's (DPP's) affliction is
businessman Chen Yu-hao, formerly boss of the Tuntex
group, a conglomerate with interests ranging from
petrochemicals to property. Tuntex is about US$2 billion
in debt and is in the process of being broken up by its
creditors, while Chen is a fugitive from Taiwanese
justice, charged with looting his own company of NT$800
million (US$24 million) that he invested in China in his
own name.
In early February Chen Yu-hao faxed
three letters to opposition legislators claiming that he
had made donations to the election campaign of President
Chen Shui-bian. At first he tried to claim that Chen
Shui-bian had simply pocketed the money, a claim that
was refuted by officials from Chen Shui-bian's own DPP,
who produced photocopies of the receipts.
The
DPP went on to point out that at the time that Chen
Yu-hao made his donations, he was regarded as a
respectable businessman, not a fugitive from justice.
The donations certainly had not earned Chen Yu-hao any
special favors since a warrant is out for his arrest on
charges of fraud. Finally, the DPP said, since Taiwan
had no law regulating political donations - one actually
was passed by the legislature on Thursday - there was
nothing illegal in either giving or accepting donations.
Larger donations given to other candidates in
2000 The DPP also pointed out that Chen Yu-hao
had given donations 10 times as large to both the other
rival candidates for the 2000 presidential election;
Lien Chan of the Kuomintang (KMT) and James Soong, then
running as an independent candidate got NT$100 million
each.
On top of this Chen Yu-hao had given
another NT$100 million to the KMT in the early 1990s,
which somehow never made its way into party coffers but
ended up in the private bank accounts of Soong's family
members.
In February it seemed that Chen
Yu-hao's involvement in the election campaign could only
be bad news for his putative opposition allies. But his
sheer persistence has made some negative impact on the
president's credibility.
Throughout March the
fugitive businessman, who is now in the United States,
has given a steady stream of interviews to sympathetic
media and he has also placed full-page ads in Taiwanese
newspapers, making his case.
He not only gave a
NT$10 million donation to Chen Shui-bian before the 2000
election, he has claimed, but also made another donation
when Chen Shui-bian was running for mayor of Taipei in
1994.
He claims to have been escorted to Chen
Shui-bian's home by DPP legislator Shen Fu-hsiung, and
then he presented a NT$3 million donation to Chen
Shui-bian's wife, Wu Shu-chen, Chen Yu-hao claims.
President's wife says she never took
money Wu vehemently denies ever having met Chen
Yu-hao and says she has certainly never taken any
donation from him. She has also offered to take a
polygraph test on the issue.
Shen Fu-hsiung, the
alleged go-between, might have been expected to shed
some light on the matter, but no sooner had Chen Yu-hao
named him as the facilitator of the meeting with Wu then
he disappeared for three days. On Thursday, March 18, he
reappeared and in a rambling news conference said that
he "might" have taken Chen Yu-hao to meet Wu, the wife,
and suggested that Wu was trying to cover up the meeting
because she did not want her husband to be associated
with the businessman's shady reputation. Or maybe, he
said, she had genuinely forgotten that it had taken
place.
The DPP has been claiming that Chen
Yu-hao has been a willing tool in an attempts by Beijing
to influence Taiwan's presidential election. The
magazine Win-Win Weekly has published alleged evidence
suggesting that Chen was put up to create mischief by
Beijing's Taiwan Affairs Office. The DPP, meanwhile, on
Wednesday announced that it had evidence that the
fugitive traveled from China, where he still has major
business interests unaffected by the demise of Tuntex,
interests financed by the money he looted from Tuntex in
fact - to the US on a People's Republic of China (PRC)
passport and entered on a business visa.
The DPP
claims China's facilitation of Chen Yu-hao's trip says
all that needs to be said about why these allegations
are being made and how much credibility they merit.
One interesting aspect of the affair is the way
that Taiwan's media has handled it. Pro-DPP media have
buried the allegations, anti-DPP media have made them
front-page news.
Donations were not illegal,
yet still an issue But the most curious aspect is
why the donations should be an issue at all. Chen Yu-hao
himself admits that there was nothing illegal about them
- though some news organizations have somewhat
carelessly referred to them as bribes. It is not that
the first family has taken kickbacks, the fugitive says,
but that they simply aren't telling the truth about
meeting him.
To what extent this will affect
Chen Shui-bian's chances of reelection is not
immediately clear. Although there is no suggestion of
wrongdoing, the opposition media have certainly managed
to give the impression that something dishonest has been
going on. And honesty, and a desire to clean up Taiwan's
rampant corruption and cronyism, have been major themes
of the DPP campaign.
Another aspect of the Chen
Yu-hao affair is that the DPP and the first lady have
spent so much time denying the businessman's relatively
innocuous allegations that they have made little use of
the connection between Chen Yu-hao and James Soong, now
the opposition's vice presidential candidate.
There is no doubt that Soong transferred NT$248
million of KMT funds into the bank accounts of his
family members in the Chung Hsing Bills Finance Corp, of
which NT$100 million came from Chen Yu-hao and another
NT$80 million from construction company boss Liang
Po-hsun. Liang is also a fugitive from Taiwanese
justice, accused of embezzling money from the Overseas
Chinese Bank. And while Soong claims the money was to be
used for party purposes, there is no evidence that it
was so used, and Soong never attempted to return the
money - neither when he left the KMT secretary-general's
post nor when he left the party itself in late 1999.
Rival James Soong vulnerable to money
charges That Soong has not been indicted on any
charges concerning this money is widely seen as
expediency on the KMT's part: after its electoral
disaster in 2000 it realized the only way to return to
office was to make an alliance with Soong and his
followers. Soong should, in theory be extremely
vulnerable to the Chung Hsing Bill's finance
allegations. Yet the DPP has been so busy protecting the
first family's reputation that it has made little use of
this potential weapon.
Allegations have also
surfaced against KMT presidential candidate Lien Chan
from the former chairman of the Taiwan Pineapple Corp,
Huang Tsung-hung. Huang claims to have made two
donations to the KMT, one in 1998 in return for which
the party was supposed to use its enormous financial
muscle to stop the stock price of Huang's company
falling, and once in 1999 when a KMT legislator, who had
previously been convicted on corruption charges, helped
Huang get a loan from a state-run bank in return for a
kickback. Lien was a beneficiary of both deals, Haung
claims.
The KMT's response was rapid denial and
a writ for defamation. Huang then held a news conference
earlier this week to make allegations against James
Soong, only to refuse to be specific about his
accusation against Soong. The press conference was ended
when an eccentric activist on behalf of stray dogs
abused Huang and told him to stop wasting the media's
time.
All of which makes for a strange election
environment. The DPP is taking fire over an alleged
meeting at President Chen's house that - even if it did
take place - had no criminal purpose. The opposition
"pan-blue" alliance, meanwhile, has as its vice
presidential candidate a man widely believed to have
stolen huge sums from his own party - and the party's
faithful don't care.
(Copyright 2004 Asia Times
Online Ltd. All rights reserved. Please contact content@atimes.com for
information on our sales and syndication
policies.)
