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Taiwan’s BLF pulls Fuh Hwa, Uni-President share of NT$35 billion mandate

By Hui Ching-hoo   
February 19, 2021

Taiwan’s Bureau of Labor Funds (BLF) has pulled the NT$10 billion (US$360 million) share of a NT$35 billion domestic equity mandate from two local firms involved in a bribery scandal linked to a former senior BLF official, and will manage the money internally, according to a spokesperson.

The Taipei District Prosecutors’ Office charged 11 employees of the two firms – Fuh Hwa Securities Investment Trust Co and Uni-President Asset Management Corp – and a third, Capital Investment Trust Co, on February 8 for allegedly colluding with Yu Nai-wen, the BLF’s former domestic division head, to rig stock prices with BLF money over the last two years.

The BLF has terminated contracts with the three companies and banned them from its tenders for five years.

According to local news reports, Taiwan’s Vice Labour Minister Lin San-quei will take over as BLF director-general from Feng-Ching Tsay in the wake of the scandal.

Fuh Hwa Securities and Uni-President were among seven local firms that won the NT$35 billion domestic equity tender in November.

The BLF spokesperson tells Asia Asset Management that the pension supervisor has forfeited the NT$10 billion quota awarded to the two firms.

“BLF internal investment team will take it over and will readjust the portfolio,” she says.

Excluding this sum, Fuh Hwa Securities, Uni-President and Capital Investment managed a combined NT$312 billion of investments for the BLF as of December 2020. The spokesperson did not respond when asked how these investments will be handled.

Asked about the reports that Ling will replace Tsay, she would only say that “the related personnel movement is still ongoing”.

The BLF has sacked Yu, who is currently under police detention.

Spokespersons for Fuh Wah Securities and Capital Investment declined to comment. Spokespersons for Uni-President could not be reached.

The BLF supervises seven pension funds and annuities with around NT$4.45 trillion of total assets as of September 2020.