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FSC chairman's resignation approved (update)

2016/10/03 16:59:02

Outgoing FSC Chairman Ding Kung-wha in the Legislature on Sept. 29

Taipei, Oct. 3 (CNA) Financial Supervisory Commission (FSC) Chairman Ding Kung-wha (丁克華) offered to step down on Monday and his resignation was approved by Premier Lin Chuan (林全), according to Executive Yuan spokesman Hsu Kuo-yung (徐國勇).

FSC Vice Chairman Kuei Hsien-nung (桂先農) also resigned. Ding will be temporarily replaced by Huang Tien-mu (黃天牧), another FSC vice chairman, Hsu said at a news conference.

In a statement issued earlier the same day, Ding announced he was stepping down to assume responsibility for money laundering allegations involving Mega Financial Holding Co. Ltd., which were made public earlier this year.

The New York State financial regulator imposed a US$180 million fine on the New York branch of Mega International Commercial Bank, a subsidiary of Mega Financial Holding Co., in August, for failing to adhere to money laundering prevention controls.

Although the FSC immediately launched an administrative probe and established a task force to investigate the case, Ding indicated he was resigning in an effort to stop attacks on the FSC and clear his name.

Ding said the FSC has concluded the first phase of its investigation into the case and imposed punitive measures against Mega Bank.

Besides, the FSC was set to submit, late on Monday, a report on the need to tighten rules governing the submission of takeover proposals after a failed attempt by a Japan-based firm to buy Taiwanese gaming software developer XPEC Entertainment Inc. (樂陞科技), which caused major losses for investors.

Meanwhile, asked whether Ding was forced out by ruling Democratic Progressive Party legislators to take responsibility for the Mega Bank and XPEC Entertainment cases, Hsu said the Cabinet respects the right of lawmakers to exercise their legislative authority.

The Executive Yuan will shortly announce the appointment of a new FSC head, Hsu added.

Taiwan Stock Exchange (TWSE) Chairman Shih Jun-ji (施俊吉) has been touted as a possible replacement, but denied on Monday he had been approached.

Ding, who has no party affiliation, assumed the post when the DPP government took office on May 20, but in the wake of the two cases came under attack from both the governing party and opposition.

(By Y.C. Tai, Flor Wang and Evelyn Kao)