Shawn Liao - Controversy

Controversy

In November 2006, just prior to the fallout of the Wall Street financial crisis and the global economic meltdown, Liao authorized on of his companies, which was managing his mother-in-law's assets, to utilize a portion of such assets to meet the company's payroll and holiday bonus commitments for employees. A family scandal ensued as a result of this misappropriation of funds. This led to a complaint being filed to the District Attorney's office and was followed by a government investigation of this one company. An out-of-court agreement was eventually reached between all parties involved.

In the meantime, after nearly three years of investigation and negotiation, the government refused to dismiss its cause against Liao. The District Attorney's office leveraged this family scandal as on opportunity to lead a public crusade to clean up Wall Street's management irregularities by corporate executives. As a result of intense media coverage in the United States and China, and an opportunity to garner publicity for the government, the District Attorney was able to successfully force an unusually lengthy and severe plea agreement in the matter of People v. Liao - by arguing that "although a family matter, notwithstanding, no action is justifiable when an offense in law has been committed."