Executive of Yintaiji Accused of Fraudulent Loans and Stock Sales Exceeding NT$800 Million, Sentenced to 20 Years

(CNA reporter Lin Chang-shun, Taipei, July 8) Lin Shi-rong, the actual controller of Yintaiji Biotechnology Co., Ltd., and others are suspected of defrauding 8 banks of over NT$406.36 million and defrauding investors of over NT$407.67 million in stock purchases. The Taipei District Prosecutors Office today indicted Lin and 11 others on charges including the Securities Transaction Act and the Banking Act, seeking a 20-year prison sentence for Lin.

According to a press release from the Taipei District Prosecutors Office, Lin Shi-rong, the actual controller of Yintaiji United Biotechnology Co., Ltd., conducted five false capital increases between March 2019 and October 2020. This led the Taipei City Government official to approve the company's registered capital from NT$20 million to NT$122 million.

Prosecutors pointed out that between May 2019 and October 2021, Lin Shi-rong and You Kun-lin, the controller of Aishivi Company, instructed the accounting manager to falsify the company's financial reports. They then used these embellished financial reports, invoices from Aishivi Company for transactions that did not actually occur, and fabricated lists of suppliers and sales figures to defraud a total of NT$406,369,200 from 8 banks.

According to the press release, the banks defrauded and the amounts involved were: First Bank NT$104,939,200 and US$668,000; Chang Hwa Bank NT$24 million; Hua Nan Bank NT$35 million; E. Sun Bank NT$69.68 million; Taichung Commercial Bank NT$36 million; Shanghai Commercial Bank NT$12 million; Far Eastern International Bank NT$2.71 million; and Cooperative Bank NT$32 million.

Prosecutors also discovered that Lin Shi-rong, knowing that Yintaiji Company's operations were poor and it had no prospect of being listed on a stock exchange, collaborated with a criminal group during the COVID-19 pandemic to quickly obtain funds. They packaged and marketed Yintaiji Company as a leading company in the epidemic prevention industry, claiming partnerships with well-known domestic manufacturers and imminent listing. They then used sales agents from cooperating underground dealers to promote the stock to the public at high prices.

Prosecutors estimate that 995 unspecified investors purchased stocks between April 20, 2020, and July 16, 2021, with a total victim amount of NT$361,173,000.

Furthermore, to obtain more funds, Lin Shi-rong and others continued their criminal plan by sending false subscription notices to existing shareholders, stating that "Yintaiji Company's affiliated enterprise, Yalianbi Company, continues to provide OEM services for major manufacturers such as Mentholatum." This defrauded original shareholders into subscribing for new shares between July 7 and August 6, 2021, with a total victim amount of NT$46,502,25.

The Taipei District Prosecutors Office today indicted Lin Shi-rong and 11 others on charges including fraudulent trading of securities under the Securities Transaction Act, the Banking Act, the Company Act, and fraud under the Criminal Code. They are specifically seeking a heavy sentence of 20 years imprisonment for Lin Shi-rong and requesting the court to confiscate the illicit gains of over NT$814.04 million. (Editor: Hsiao Po-wen) 1150708

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