Taiwan ex-top cop indicted in laundering probe

The indictment against Yeh Sheng-mao came as prosecutors investigate allegations that Chen and his wife wired $20 million into the Swiss bank accounts of their son and daughter-in-law.

Yeh was head of the Justice Ministry's Investigations Bureau, responsible for internal security, and drug and white-collar crime enforcement. He retired shortly after Chen's second and final four-year term ended in May.

The Taipei Prosecutors' Office said Yeh concealed a January 2008 report sent to his office by the Egmont Group--an international group collecting information on suspicious financial activities. The report asserted that the former first couple's daughter-in-law had opened an account in the Cayman Islands, one of the destinations for the allegedly laundered funds.

"As chief of criminal investigation and money laundering, he failed to report the document, so we lost valuable time in probing this case," said prosecutor Lin Chin-chun.

Prosecutors have already listed Chen and wife Wu Shu-chen as suspects in their investigation into whether the Swiss bank transfers amounted to money laundering.

Chen admitted earlier this months that he broke the law by not fully disclosing campaign donations he had received, after a lawmaker alleged that Chen's son and daughter-in-law moved the money to Switzerland in 2007, and then forwarded the funds to the Cayman Islands.

Prosecutors say they are trying to determine whether the funds were indeed donations left over from political campaigns--as Chen insists--or whether bribery might have been involved.

Under Taiwanese law, false declaration of donations is subject to a fine of $9,670, but money laundering carries a seven-year prison sentence.

Several Nationalist lawmakers have alleged that the ex-president took large bribes in connection with a spate of mergers initiated by the government in 2005, when several small banks took over a number of well-established financial institutions.