Chen admitted the existence of the funds overseas after Legislator Hung Hsiu-chu of the ruling Kuomintang (KMT) held a press conference in the morning saying that Chen had stashed as much as NT$700 million in Swiss bank accounts of his daughter-in-law Huang Jui-ching.

Hung said that Swiss prosecutors had already frozen the funds and asked Taiwan authorities to verify the origins of the huge amount of money in the name of Huang.

She said the dubious funds came under Swiss probe mainly because Huang had not been working for many years while, her own father formerly served only as a manager in a small local credit cooperative in central Changhua County.

Henry M.J. Chen, spokesman for The Foreign Ministry, confirmed that the Swiss authorities had requested the government's assistance and cooperation in an unspecified case.

But he declined to reveal the contents of the request, saying the ministry had already forwarded the Swiss document to the Ministry of Justice.

Meanwhile, local cable news station TVBS also reported that more than US$20 million was deposited in bank accounts in Switzerland in the name of Chen's daughter-in-law.

Legislator Hung called for a formal investigation to determine if the former national leader had violated the anti-money laundering regulations.

Chen admitted in the afternoon that he had kept money left from the funds raised during four major election campaigns in recent years.

The money came mainly from contributions of supporters and subsidies from the government for candidates. Chen took part in two races for Taipei mayor and two for the presidency, the last one in 2004.

He explained that he learned of the fact only early this year that his wife, Wu Shu-chen, had wired unspecified amount of money abroad.

Chen said he had to apologize to all the voters and people of the nation for breaking the regulations requiring that all senior officials report their assets to the Control Yuan under the law fighting corruption.

The Chinese-language Next weekly magazine first reported early this week that the former president had allegedly engaged in possible money laundering operations because he had remitted more than NT$300 million into bank accounts in Switzerland.

The weekly, an affiliate of the Apple Daily, reported that the Egmont Group, an international anti-money laundering network, had alerted Taiwan authorities that former first lady Wu had made large money transfers to several foreign bank accounts.

Citing anonymous sources, the magazine said that Wu had closed Taiwan bank accounts belonging to her and her husband, as well as several others, in 2006 soon after the exposure of the "state affairs fund" scandal in which they were charged of embezzling public funds with invoices or receipts used by other people.

In that scandal, Chen's wife and three close aides were charged with misuse of public funds.

Chen himself was immune from charges while a sitting president, but prosecutors launched a probe against him immediately after he stepped down from office on May 20.

Just on Wednesday, Chen instructed his lawyer Lee Sheng-chen to deny all allegations about the existence of the questionable money abroad.

Lee described the contents of the report were "totally unfounded."

But in a televised news conference yesterday, Chen said he had to apologize for not clearly accounting for his campaign contributions, saying the failure to make such a report was "something that is not permitted by the law."Arguments

Chen, a lawyer, insisted his wife had made the wire transfers absolutely without his knowledge.

Among his major arguments, Chen said there was no law requiring him to report the funds at the time when he received the political donations.

Under Taiwan's campaign laws, candidates are required to report campaign spending. But candidates were not required to report all political donations until the enactment of the Political Contributions Act in 2004.

Chen said that his wife had stashed the funds overseas in case he needed them after he stepped down from the presidency on May 20.

He said that after learning about the transfers earlier this year, he immediately decided that he would use the funds in the future for Taiwan's diplomacy.

Defending the act of his wife, Chen said many prominent politicians besides him also had failed to fully report campaign funds.

He also said that former President Lee Teng-hui had wired abroad as much as NT$1 billion in the names of other people.

James Soong, chairman of the people First Party and a former Presidential candidate, had transferred NT$380 million overseas. KMT Honorary Chairman Lien Chan, a former Vice President, has retained huge funds and assets abroad as well, according to Chen.

He even alleged that President Ma Ying-jeou, the incumbent, had failed to faithfully report the accurate figures for his campaign funds in accordance with the regulations.

Full probe

Chen said he is willing to accept criticisms and investigation. But all those he mentioned should also come under probe, he added.

He urged the special criminal investigation task force under the Supreme Prosecutor Office to immediately launch extensive and full investigation into all the cases.

He especially denied that there were any links between the funds his wife wired abroad and the series of scandals during his presidency, including the disappearance of NT$1 billion of public funds, allegedly swindled by two self-claimed diplomatic brokers over a botched attempt to regain Papua New Guinea as a diplomatic ally.

Chen's open and unexpected admission of the funds abroad is likely to add to his legal woes, since it comes as the former president is already battling charges that he misused public funds.

Leaders and lawmakers of the opposition Democratic Progressive Party (DPP) have been organizing a large-scale public protest on Saturday, Aug. 30 in Taipei against President Ma against what they claimed as the bullying and persecution of a "Taiwanese president."

Some DPP leaders said they were shocked by Chen's open admission of the huge fund deposited abroad, when the party has been in deep debt after waging a string of costly election campaigns over the past eight years, including helping Chen win two terms as president.