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Taiwan finance minister warns against extending credit to Ting Hsin amid tainted oil scandal

Reuters | Wednesday, Oct 29, 2014

TAIPEI - Taiwan's finance minister said on Wednesday that Ting Hsin International Group has become a high risk enterprise and lending to the embattled food maker should be restricted.

Ting Hsin is at the centre of a major food safety scandal in Taiwan for allegedly selling tainted oil meant for animal and industrial use as fit for human consumption.

Prosecutors in Taiwan have been investigating Ting Hsin and earlier this month detained Wei Ying-chun, a key member of the family that controls Ting Hsin International Group over the alleged sale of tainted cooking oil.

Ting Hsin is the parent company of Hong Kong-listed Tingyi Cayman Islands Holding Corp and makes China's popular Master Kong instant noodles and beverages, while its Taiwan-listed Wei Chuan Foods Corp. produces popular Wei Chuan branded goods.

Public outrage on the island has been intensifying and pressure has been growing on the Wei family to step away from its various investments, including its management positions at Taipei Financial Center Corp, which runs the iconic 101 Taipei skyscraper.

Taiwan Finance Minister Chang Sheng-Ford, speaking to lawmakers in a parliamentary committee session, said that Ting Hsin has become a high risk enterprise, therefore no new credit should be extended to Ting Hsin and any existing borrowing should be backed by collateral if it is not already.

Ting Hsin should also bear higher interest rates in any borrowing, he said. "Ting Hsin has no social responsibility," Chang said.

Ting Hsin's unit, Cheng-I Food Co, is already being investigated on suspicion of mixing animal feed oil with cooking oil and selling it for human consumption, prosecutors have said.

Officials at Ting Hsin could not be reached for comment immediately.

In September, another company, Chang Guann Co, said it had sold adulterated cooking oil to restaurants, schools and food processors.

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