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LAWMAKERS URGE MND NOT TO COMPROMISE ON LAFAYETTE COMMISSION CASE

ROC Central News Agency

2005-04-23 21:03:45

    Taipei, April 23 (CNA) Two lawmakers familiar with military affairs urged the Ministry of National Defense (MND) Saturday to defend national interests in negotiating the Lafayette frigate kickback case with French authorities.

    Legislators Lee Wen-chung of the ruling Democratic Progressive Party and Lin Yu-fang of the opposition People First Party made the call after the French daily Le Monde reported Friday that the French government has named a former finance ministry official to negotiate with Taiwan over compensation for a Lafayette frigate commission scandal.

    According to the report, the French government hopes to resolve the case through negotiations instead of a court verdict. And if the international arbitrary court handling the case rules that France must compensate Taiwan for illegal kickbacks in the Lafayette frigate deal, the report said, France is hopeful that a fugitive Taiwan arms broker can be made to pay part of the amount.

    Taiwan purchased six Lafayette-class frigates built by French defense contractor Thomson-CSF for US$2.8 billion in 1991. The contract signed between the ROC Navy and the French firm clearly stipulated that no kickbacks were allowed in the deal.

    However, allegations about kickbacks over the deal emerged after the death of Navy Captain Yin Ching-feng, head of the navy's arms acquisition office, whose body was found floating in the sea off the east coast of Taiwan in late 1993.

    It has been alleged that Yin was murdered to prevent him from blowing the whistle on rampant corruption in the military -- including the Lafayette deal. Kickbacks involved in the Lafayette deal allegedly reached an estimated US$500 million.

    The ROC Navy has filed an appeal with an international commercial arbitrary court in France in August 2001 to seek compensation from French authorities. Moreover, the Navy asked for an additional US$99 million in damages to its reputation.

    Commenting on the latest French media report, the two legislators said it is understandable that France would seek to consult with Taiwan over the Lafayette kickback issue.

    Lee and Lin further said they believe that the court ruling would very likely be unfavorable to France. They urged the MND and other relevant government agencies to start preparations for possible negotiations with France over the kickback issue.

    The two lawmakers also said the MND should stand firm on its stance and defend national interests in future negotiations.

    As to whether the MND should agree to the reported French proposal that Andrew Wang, an arms broker who fled Taiwan in 1993 and has been wanted since September 2000 for suspected involvement in the alleged Lafayette kickback scandal and the subsequent murder of Navy Captain Yin, be made to pay part of the compensation, the two lawmakers said it should depend evidence presented by France. According to the contract, France alone is liable to pay the compensation.

    A Swiss federal court has ruled that Taiwan, France and the Principality of Liechtenstein should be given access to Swiss legal files, particularly documents regarding the Andrew Wang family's bank accounts in Switzerland, to facilitate investigations into the alleged Lafayette kickback scandal.

    Swiss judicial authorities have frozen Wang's Swiss bank accounts, which contain some US$600 million in suspected slush funds used as kickbacks from the Lafayette frigate deal, according to previous press report.

    Wang and his son, Wang Chia-hsing, might also have bank accounts with deposits totaling US$100 million in Liechtenstein and the British-administered Cayman Islands in the Caribbean Sea.

    Since Aug. 1, 2000, an ROC special investigative team has been probing arms procurement scandals allegedly connected with the death of Navy Captain Yin under suspicious circumstances.

    No major breakthrough has been achieved because key suspect Wang, who is believed to be deeply involved in the Lafayette kickback scandal, remains at large, reportedly residing in London.

    The investigation team has not yet discovered any hard evidence of alleged Lafayette kickbacks paid to Taiwan officials.

    To speed up the investigations, the team has recently recruited several prosecutors versed in financial and banking affairs to assist in tracking the money trail.

(By Sofia Wu)

ENDITEM