TAIPEI: Taiwan's Mega Financial Holding Co said chairman Shiu Kuang-si has submitted his resignation, in a widening fallout after the company's banking unit was fined earlier this month for violating US anti-money laundering regulations.



Shiu's resignation at the state-controlled firm is likely to be accepted, Deputy Finance Minister Su Jain-rong told Reuters on Wednesday. Mega Financial's chairman is appointed by Taiwan's finance ministry.



The New York branch of Mega Financial's banking unit agreed this month to pay US$180 million to New York state's financial regulator for anti-money laundering violations that included lax attention to risk exposure in Panama.



The US fine, the first for a Taiwan-based financial institution in a decade, set off a local probe with Taiwanese prosecutors summoning current and former executives of Mega Financial, including Shiu, as well as a former finance minister, for questioning.



Taiwan's cabinet has formed an emergency taskforce to supervise its investigation into Mega Financial's New York operations with financial regulators travelling this week to the United States.



According to a statement from the company on Wednesday, Shiu, in his resignation letter, said he was removing himself from all his positions in the financial conglomerate amid domestic speculation of his role in the investigation.



Shiu, the brother-in-law of Taiwan's central bank governor, was appointed by the finance ministry this month as chairman of Mega Financial. He had been its president till 2014, before leaving to join other state-run banks in Taiwan.



"In the face of pointless accusations, my role is not beneficial to clearing up the problem and it is difficult to gain the trust of the people and has even hurt authorities (looking into the case)," Shiu wrote in the letter, according to the statement. - Reuters

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