Taiwan's Chen son-in-law sentenced to jail

TAIPEI, Dec 27 (Reuters) The son-in-law of Taiwan President Chen Shui-bian was found guilty of insider trading and sentenced to six years in prison today in the latest of a series of scandals that have undermined Chen and his independence-leaning Democratic Progressive Party (DPP).

Chao Chien-ming, who is married to Chen's daughter, was also fined T30 million dollars (7,000) following the verdict by a court in Taipei, according to Taipei District prosecutor.

He plans to appeal.

Prosecutors charged Chao in July with insider trading over a property firm and were seeking an eight-year sentence and fine of T30 million dollars.

Chao and four others were charged with trading Taiwan Development Corp. stock after receiving information about a loan for the company that could have influenced its share price and reaping over T5 million in profits, prosecutors said.

The scandal was just one of several dogging Chen, his wife and former aides.

Those scandals have pushed Chen's popularity to record lows and tarnished the image of the DPP, formed 20 years ago on a clean government platform.

But in a surprising twist that revealed the polarised state of the island, the China-friendly opposition Nationalists narrowly lost the mayor race to the DPP candidate earlier this month in the island's second biggest city, Kaohsiung.

Many had predicted the Nationalists, or KMT, would win the race despite the city's traditional DPP-tilt, signaling strong prospects for the party heading into the island's 2008 presidential elections.

In the biggest of the other cases dogging Chen, his wife, Wu Shu-chen, and three former presidential aides are facing corruption charges stemming from allegations of misuse of government funds.

Chen has said he will step down if his wife is found guilty in that trial, which began earlier this month.

REUTERS PB VC14338