Businessman accused of using Taiwan government money to fund reverse takeover by Chinese firm
Taiwan News
Date: 2019/07/27
By: Matthew Strong, Taiwan News, Staff Writer
The complicated structure of a Taiwan-China jeans deal (screenshot from legislator Huang Kuo-chang's Facebook page).
TAIPEI (Taiwan News) – Jeans maker Chen Shih-hsiu (陳仕修) was freed on bail of NT$5 million (US$160,000) Saturday (July 27) morning amid allegations he took more than NT$1.4 billion (US$47.8 million) in National Development Fund (NDF) money to help a Chinese firm control his own.
The allegations were first made more than a year ago by New Power Party lawmaker Huang Kuo-chang (黃國昌).
Chen used the funds to have his company Roo Hsing Co. (如興紡織) take over a Hong Kong-registered affiliate of a Chinese firm, JD United Holdings (玖地), but in reality the opposite was true, with the supposed target company receiving Taiwanese government funds to infiltrate a Taiwanese business, Huang alleged. JD United Holdings was originally five times larger than Roo Hsing, the Liberty Times reported.
The Taiwanese company, founded in 1977, is the largest jeans processing firm in Taiwan.
The money it received from the NDF was the first the body gave under a new support program for industrial innovation in traditional sectors, according to the Liberty Times.
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