Mega Financial Holding Co Ltd, one of Taiwan’s five-biggest financial firms, allegedly violated anti-money laundering rules, however, prosecutors dropped the case and said on Monday they will not indict Mega Financial Holding.
The prosecutors believe that Mega Financial Holding Co Ltd may have violated U.S. AML rules out of ignorance because there was no evidence found of intentional wrong doing. This incident has led authorities to question the financial regulations on the island that led to the resignation of the Financial Supervisory Commission’s chairman,Tsai Yeou-tsair, who is a defendant in the case and currently banned from traveling outside of Taiwan. Although, Tsai Yeou-tsair claims his resignation is due to health reasons.
In anticipation of the share price of Mega Financial dropping, Tsai sold his shares in the company before the DFS announced its sanction on August 19. He made NT$568,876 (USD$190,000) from the trade shares.
Although the New York branch of Mega Financial recognized Panama as a high-risk jurisdiction for money laundering, the authorities in New York state were “indifferent” to the insecurity affiliated with transactions involving Panama. In August, 2016, the firm agreed to pay $180 million as a penalty for violating the U.S. Bank Secrecy Act (BSA) and anti-money laundering regulations.
The fine is a major embarrassment for the Taiwan government because Mega Financial’s management has close ties to key government officials and the industry is monumental in Taiwan’s financial system.
For the full story, view http://www.reuters.com/article/us-mega-fhc-taiwan-probe-idUSKBN18I08K