Lafayette Case Resurfaces

The Lafayette case, the kickback scandal involving France, China, and the KMT, is a still limping along. Last year it surfaced briefly when the Swiss returned some money to Taiwan. Now the day before President-elect Ma Ying-jeou is sworn in, the district court plans to call as witnesses reactionary right-wing heavyweight politician Hau Pei-tsun, father of the current Taipei mayor, and former President Lee Teng-hui in a related case, along with 20 other former officials. Hau was hauled in for questioning before and more or less blamed Lee. Of that, I wrote earlier:

Back in 1989-91, when the procurement decision was being made, newly-minted President Lee Teng-hui and longtime KMT stalwart Hau were struggling over just who controlled the military. Hau's reference thus is imbued with surpassing irony: Lee could not have made the decision, because in the period 1989-1990 he did not control the military; Hau did. In fact, in January of 1988, when Chiang Ching-kuo died and Lee ascended to the Presidency, a hardline faction of mainlander officers threatened a coup. The intervention of James Soong, who mediated the crisis, enabled Lee to retain power. The early years of Lee's presidency were thus overshadowed by the conflict between Hau, point man for this faction (the "non-mainstream faction"), and Lee representing the Party Machine and the mainstream KMT factions, over the direction of the KMT, and the shape of the government. Lee moved Hau out of his position as Chief of the General Staff, into the post of Minister of Defense, and finally to the position of Premier in May of 1990. Hau was appointed to that position because of the continuing threat of hardliners who wanted to run Hau as an alternative Presidential candidate in the March 1990 election, and because the previous premier, Lee Huan, had sided with the hardline mainlanders against Lee Teng-hui (he was a close associate of Chiang Ching-kuo). In fact Hau would eventually run as the Veep on an alternative ticket with Lin Yang-kang in 1996.

I have two reviews of the case, a short one here and a very long one here. Note that it was the visit of current VP-elect Vincent Siew to France in 1990 that apparently sparked the sale and the subsequent scandal. Siew has also been questioned in the case, as he was Minister of Finance at the time. Ma Ying-jeou called for a halt to the questioning when he was Chairman of the KMT.
The timing of the court date is interesting, and some have speculated that anything that comes out might overshadow Ma's big day the next day. Highly unlikely. Hau has already been questioned to no avail, and Lee Teng-hui, following his post-presidency wish to play power behind the throne for somebody, anybody, is giving advice to Ma. He isn't likely to embarrass the new regime either. If anything does come out, it is more likely that Ma's swearing-in will overshadow it, which may explain why it was scheduled for that day in the first place.

The Swiss admitted this week that the amount of money they hold in the case is double what was previously admitted.

Swiss authorities said Thursday that $900 million (?572 million) belonging to Taiwanese citizens remained frozen in Swiss bank accounts linked to the alleged corrupt sale of six French frigates to Taiwan in the 1990s.

In 2006 I noted:

In 1990 and 1991 Lee and Hau were still struggling for control of the government. Hau, the premier, and a conservative mainlander, argued that Taiwan had a parliamentary system in which the Premier should hold the power, while Lee pushed for a Presidential system that would concentrate power in the Chief Executive. Lee shoved through six constitutional amendments during the 1990s, and every one increased the power of the President. At that time too Hau had just come from being head of the military, the former chief of staff, and had enormous influence over military affairs. Lee had him moved from that post to the Minister of Defense, to decrease his power. It seems unlikely that if Hau was in charge of the purchase, Lee Teng-hui got anything out of the deal. The DPP has publicly claimed this, and a Control Yuan investigation also backed Lee and demanded that Hau be impeached -- though several impeached officers claimed Lee knew (Lee was also implicated in a similar kickback scandal over the Mirage Fighter purchase in the 1990s, though that decision also occurred before he gained influence over the military). Perhaps the current legislative freezing of the Control Yuan is an attempt by the Blues to stop the Lafayette investigation, since it touches on so many major mainlander political figures, most importantly Hau and Soong. Other military figures, mostly mainlanders, were impeached over the scandal.

Almost all the alleged beneficiaries and alleged participants are still in the government and other positions of authority, formal and informal. Those who are wont to claim the KMT has changed, should take note....

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