Ex-Premier Answers Questions In Frigate Case
(Source: Taiwan News; issued July 18, 2006)
Former Premier Hau Pei-tsun said on Tuesday that it was not his duty to approve the purchase of French Lafayette class frigates in 1991, though he admitted to issuing instructions from overseas for the Navy to hold off on the procurement of warships from South Korea while he was in France in 1989.

He gave instructions to postpone the purchase of the South Korea's warships in order to "compare the prices quoted by three sellers and thus avoid a loss" (by the government) in the arms deal, Hau said.

Hau, a soldier-turned-politician who served as premier from 1990 to 1993 under then President Lee Teng-hui, appeared at the Supreme Prosecutors' Office on Tuesday morning after he was summoned by prosecutors investigating a kickback scandal surrounding Taiwan's procurement of Lafayette class frigates in the early 1990s.

Hau, who was questioned as a witness in the case, asserted that it was the commander in chief of the ROC military who had the final say on whether to buy the frigates from France or South Korea, indicating that former President Lee was the person who had made that decision.

Commenting on his role in the case, Hau said that he simply offered advice to the Navy in his capacity as chief of general staff, the country's top ranking military commander next to the president.

Hau, who was serving as premier when the government made the decision to buy the warships from the French, told investigators that he had no part in the decision-making process regarding the ships.

The decision to purchase six Lafayette frigates from France instead of 16 warships manufactured by South Korea was mainly based on the Navy's advice, he said.

During the four-hour interrogation session, Hau also denied that he knew fugitive arms broker Andrew Wang or Lily Liu, whom members of Democratic Progressive Party alleged were Hau's accomplices in a kickback scheme related to the arms deal.

Some DPP members alleged last November that Lily Liu and another man, Edmund Kwan, helped the French frigate manufacturer to bribe Taiwan government officials as well as officials in China to avoid objections and smooth the way for the sale of the frigates to Taiwan.

Claiming that Hau sees Lily Liu "as his daughter," the DPP members said that she took US$100 million, as instructed by the French manufacturer, to China in 1990 to buy off some government officials there.

Hau, however, vehemently denied the accusation. Hau was summoned for questioning one day after prosecutors subpoenaed former Premier Vincent Siew.

Last week, a former legal adviser to the Ministry of National Defense, CV Chen, was summoned to explain the MND's role in the arms deal, which turned complicated following the death of ROC navy captain Yin Ching-feng, who was allegedly murdered in 1993.

According to DPP legislative leader William Lai, Hau should explain whether an overseas account in his second son's name, Hau Hai-yen, was linked to the case. Lai said his party had "intelligence" that a huge sum of money deposited in that account might have been linked to the Lafayette case.

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