Probe of Taiwan presidential hopeful wrapping up

Taipei, Feb 8: Taiwan Nationalist Party Chairman Ma Ying-jeou could lose his status as front-runner to become the island's next president if prosecutors charge him with misuse of government funds after an investigation now nearing its close.

The high court prosecutor's office is now wrapping up its nearly three-month probe into Ma over possible misuse of a special discretionary fund during his tenure as Taipei mayor, said prosecutor office spokesman Chang Wen-cheng.

An indictment could be a blow to hopes for a thaw in relations with China, as Ma and his party -- also known as the KMT -- are considered relatively sympathetic to Beijing, which sees the self-ruled island as part of its territory.

China distrusts the independence-leaning Democratic Progressive Party (DPP), which currently holds the presidency, and support Ma's expected candidacy for the 2008 elections, said Hsu Yung-ming, assistant research fellow at the think-tank Academia Sinica in Taipei.

It was DPP members who suggested that Ma, whose term as Taipei mayor ended in December, be investigated to see whether he spent some of the T.08 million in a special fund for personal use.

Prosecutors are divided over whether they have enough evidence to file charges, but the top one is leaning towards an indictment, said a Nationalist legislator close to the case.

According to its by-laws, the Nationalist Party would suspend Ma's membership if he were indicted but reinstate him if cleared in court, said spokesman Su Jun-pin.

Ma could not could not run for the presidency as a member of the KMT if he was suspended from the party. Analysts said that were this to be the case he could run as an independent with informal backing from the party.

Days after the probe began, Ma said the mayor's office had done its own review and discovered that some reporting for reimbursement of expenses was done improperly. He apologised, but said the incident was not an example of corruption.

President Chen Shui-bian's wife was indicted in early November for alleged misuse of the presidential office's confidential state affairs fund, and court hearings are underway.

The state prosecution has also said that there is enough evidence to indict the unpopular president, though he cannot be prosecuted while in office.

Reuters