(June 25): A member of Taiwan’s billionaire Tsai family was involved in a physical altercation with the chairman of Cathay United Bank Co, drawing the involvement of law enforcement and exposing a bitter rift over corporate governance.
Tsai Chen-yu, one of the sons of the founder of Cathay Financial Holding Co, allegedly assaulted the banking unit’s chairman, Kuo Ming-jian, on Tuesday, according to a company statement. Local media reported that Taipei police dispatched officers to the scene following the incident.
The dispute underscores growing tensions within one of Taiwan’s most powerful financial dynasties over outside board seats and conflict-of-interest allegations.
The confrontation stemmed from a “misunderstanding” regarding Kuo’s external business roles, the bank said. Kuo, who also sits on the board of Cathay’s asset-management subsidiary, has faced scrutiny for serving as an independent director at local chip designer Alchip Technologies Ltd.
An internal review by Cathay Securities Investment Trust found that Kuo’s position at Alchip created an investment conflict of interest across eight of its funds. The compliance breach forced the unit to restate the net asset values of the impacted funds, resulting in NT$454 million (US$14 million or $18 million) in losses, Taiwan’s Liberty Times reported. Kuo resigned from his Alchip directorship on Monday.
Tsai, whose brother Tsai Hong-tu chairs the parent conglomerate, on Thursday doubled down on his criticism of the executive. He didn’t mention the altercation.
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“Mr Kuo’s extensive outside appointments have already undermined his fitness and suitability to serve as chairman,” Tsai, who’s in his 70s, said in a statement published Thursday by the Economic Daily News. “This disregards the interests of Cathay United Bank’s customers and shareholders.”
Tsai, who doesn’t hold an official role at the conglomerate, called Kuo’s list of external positions “astonishing.”
That came after Cathay United Bank defended its chairman on Wednesday, emphasising that all external positions were fully disclosed and legally reported. While acknowledging the dispute was rooted in Kuo’s outside appointments, the lender condemned the billionaire scion’s actions.
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“Resorting to physical confrontation was not an appropriate means of expressing his views or demands,” the bank said, adding that corporate grievances must be handled through “legal and rational dialogue.”
Tsai Chen-yu could not be reached for independent comment. Cathay United Bank had no immediate comment on Tsai’s statement.
The Financial Supervisory Commission has launched an on-site inspection of Cathay SITE and officials will seek to figure why the asset-management subsidiary was not informed of Kuo’s role at Alchip, the regulator said during a press conference Thursday.
The FSC added that Cathay United Bank has records of all of Kuo’s outside appointments, including the dates on which each was disclosed.
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