1.he Investigative Process

Kaohsiung District Prosecutors Office has received a case transferred from the New Taipei City Field Division Office of the Ministry of Justice Investigation Bureau, regarding suspected manipulation of Fu○ Company’s stock price. The case was assigned to Prosecutors Wu Shao-Chin and Kao Yung-Han for investigation. After thorough investigation and evidence collection, the defendant Liu (male, age 68) was summoned for questioning. The prosecutors determined that the defendant violated the Securities and Exchange Act and have accordingly filed a public prosecution.

2.The results of investigation

The defendant Liu has been charged with violating Article 155, Paragraph 2 of the Securities and Exchange Act, in conjunction with Paragraph 1, Subparagraphs 4 and 5 of the same article, and is suspected of committing the offense under Article 171, Paragraph 1, Subparagraph 1 of the same Act.

3.Brief Facts of This Case

Liu ○○, an investor, was fully aware that Fu○ Company’s stock is a listed security traded on the Taipei Exchange, and that the price of securities traded at such exchanges should be naturally determined by the forces of supply and demand. Despite knowing that it is prohibited to artificially manipulate prices, Liu ○○, from February 1, 2021, to May 3, 2021, used online and phone orders through five securities accounts belonging to himself and family members. By employing methods such as consecutive high buying and low selling or reciprocal orders, he created the false appearance of active trading and inflated Fu○ Company's stock price to attract unsuspecting investors into purchasing Fu○ stock. During this period, Fu○'s average daily trading volume reached 510,000 shares, representing a 410% increase compared to the previous month’s daily average of 100,000 shares. Consequently, Fu○'s stock price surged from NT$4.6 at the beginning of the period to NT$8.29 at the end, reflecting an increase of 80.22%, which was significantly out of step with similar stocks and the overall market trend. This manipulation affected Fu○'s stock price and disrupted the securities market. Liu ○○ illegally profited more than NT$980,000, with an additional notional gain of over NT$40,000, totaling over NT$1,020,000.