Tycoon denies paying Chen family for favour

PUBLISHED : Thursday, 28 August, 2008, 12:00am
UPDATED : Thursday, 28 August, 2008, 12:00am

Department store tycoon Douglas Hsu Shu-tung of the Far Eastern Group yesterday denied giving US$11 million to the family of former Taiwanese president Chen Shui-bian.

He sued Kuomintang lawmaker Chiu Yi, four reporters and a political talk-show commentator for defamation for alleging the money was paid in return for former first lady Wu Shu-chen's help in his acquisition of the management rights to popular Taiwan department store Sogo.

The six said or wrote that he had wired the money to a foreign bank account opened on Wu's behalf.

The claim, and his denial, were the latest developments in a snowballing money-laundering scandal implicating Mr Chen.

The allegation dragged down the share prices of five of the group's listed companies, prompting Mr Hsu to hold a news conference.

'The Far Eastern Group would not allow anyone to smear it, and I hope those who are influential would be more restrained in words to avoid hurting other innocent people,' he said at the news conference in Taipei.

Chiang Ju-jung, lawyer for Mr Hsu, said the accusations by the six had seriously damaged the image of Mr Hsu and the group.

Yesterday, prosecutors investigating the allegation that millions of dollars were wired to overseas bank accounts opened in Wu's name or on her behalf questioned four former senior aides to Mr Chen over his handling of election campaign donations.

Mr Chen has told prosecutors his wife had, without his knowledge, wired overseas US$21 million in leftover election campaign donations.

Taiwan also sent a prosecutor to Singapore to seek the city state's help in checking the bank account of Wu's brother, Wu Ching-mao, who has admitted helping her open an account there and wiring money to it.