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DORTS offices raided in probe of '06 land deal

TAIPEI, Taiwan -- Prosecutors yesterday raided the offices of the Department of Rapid Transit Systems, Taipei City Government (DORTS, 台北市捷運局) on suspicion of alleged corruption over a development project which may have cost the city NT$10 billion in losses, and summoned a number of officials involved in the deal for questioning.

The development project dates back to 2006, when DORTS inked a questionable deal with Radium Life Tech Co. (日勝生) to build a housing complex at Xiaobitan MRT station (小碧潭捷運站). Following its completion, prosecutors uncovered that DORTS had grossly underestimated the value of land which it supplied for the development project, in addition to inflating the value of buildings constructed by Radium Life Co. on their end of the agreement. Consequently, the Taipei City Government incurred losses estimated to exceed NT$10 billion in the deal.

The inaccurate estimates are suspected to be the result of tampering of valuation assessment reports by certain city government officials, according to investigators. Prosecutors stated that they are in the process of identifying the motives behind the forgery, and did not rule out the possibility that collusion between government officials and private enterprises was responsible for illegally securing the incentives. Those involved may face charges of corruption and forgery, said prosecutors.

DORTS put up 99.35 percent of the land in the development, while Radium Life Co. contributed the remainder of 0.65 percent, yet the latter received the lion's share of the project's expected proceeds, said prosecutors.

In addition, reports indicate that Radium Life Co. significantly escalated the scale of the development, building more than 1,000 housing units across 16 high rises instead of the 700 planned initially.

Prosecutors stated that former DORTS Joint Development Division chief Kao Chiya-nong (高嘉濃) and a number of defendants failed to preserve the interests of the people, and in spite of their roles as public sector stakeholders in the deal, they had intervened to distribute personal gains among parties tasked with completing the development project.

The Control Yuan (監察院) last year launched an impeachment case against Kao and DORTS Chief Engineer Chang Chi-der (常岐德) over the same charges. As both Kao and Chang are former government officials, the two men were also probed by the Public Functionary Disciplinary Commission (公務員懲戒委員會) by order of the Control Yuan. Reports indicate that prosecutors have begun the process of determining Kao's criminal liability in the case.

Apart from Kao and Chang, prosecutors, armed with five warrants, yesterday searched a number of the homes and offices of suspects in the case, while summoning about 10 persons of interest for questioning.

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This photo shows a housing complex near Xiaobitan MRT Station, a development which is at the center of an investigation into suspected corruption. In 2006 the Taipei City Government had entered a joint-development agreement with a company to construct the housing complex. (CNA)

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