Two former Mega Financial Holding Co. executives were order detained by the Taipei District Court early Wednesday on suspicion of breaching the Security and Exchange Act and Banking Act.
The two former executives detained were McKinney Tsai (???), the former chairman of Mega Financial Holdings, and Wang Chi-pang (???), the company's chief secretary.
They will not be allowed to meet with anybody except for their lawyers while they are detained.
The detentions followed the questioning of 18 people, including Tsai, Wang and Ruentex Financial Group Chairman Samuel Yin (???) from Monday to 5 a.m. Wednesday as part of an investigation into money-laundering allegations against Mega International Commercial Bank, the financial holding company's banking unit.
Prosecutors filed a motion to have Tsai and Wang detained because of fears they could tamper with evidence or collude in the case.
Yin, who proclaimed his innocence before meeting with prosecutors, was released after two hours of questioning.
Mega Bank came under investigation by Taiwanese authorities after its New York branch was fined US$180 million last year by the New York State Department of Financial Services for violating the state's anti-money-laundering laws.
The department called the bank's program to comply with existing banking laws, including the anti-money laundering laws, was a "hollow shell" and described its compliance failures as "serious and persistent."
In the course of the investigation, Taipei prosecutors said they collected evidence showing that Tsai and Wang had approved questionable loans of some NT$20 billion to Chien Chi Asset Management Co., a Ruentex-invested company, earlier this year while Tsai was chairman of Mega Holdings.
Tsai stepped down as Mega Holdings' chairman in March to become the chairman of Chien Chi shortly after.
Tsai was already listed in August as a potential defendant in the anti-money laundering case, which means he is under formal investigation for the charges.
Source: Focus Taiwan News Channel