Taipei, May 12, 2008 (CENS)--Pai Wen-cheng, chairman of Polaris Financial Group, plans to resign the posts of the chairman and president of Polaris Securities, flagship firm of the group, in order to dedicate to handling the indictment of betrayal of trust and violation of the Securities Transaction Law against him, revealed a ranking official of the group.

Pai made the decision after he returned from a trip to Japan and reported to the Taipei prosecutors` office for the case before being released with an NT$20 million of bail.

The case involves sale of 27% stake in Polaris Securities Investment Trust by an investment company, owned by Pai`s family, to Polaris Securities at NT$65 per share in NT$69 per share, with the proceed reaching NT$900 million, in late 2004.

In 2005, Polaris Securities Investment Trust posted whopping loss of NT$2.98 per share on its 2004 financial statement, due to provisions for its loss from investment in structured notes. Prosecutors suspected Pai Wen-cheng engaged in insider trading in the case, by selling the stake owned by him and his family in Polaris Securities Investment Trust to Polaris Securities before the publication of the former`s poor performance.

In an advertisement on major local newspapers today (May 12), Pai pledged innocence arguing that the price for the deal was based on the appraisal of independent appraisal agency and certified public accountant.

Industry insiders are observing closely the impact of the storm on the operation of Polaris Financial Group, which has emerged as a shining player in the domestic financial market in recent years, thanks to its aggressive initiatives in pioneering new securities products, including derivatives and ETF (Exchange Traded Fund) products.
(by Philip Liu)