Former chairman's debt scandal drags down Taiwan's social housing rental services

Zhaoji Property Management, a leading social housing rental service provider in Taiwan, is embroiled in a scandal involving its former chairman, Li Jiancheng, who is accused of misappropriating NT$700 million for investments and defaulting on debts. The investigation has cast a shadow over the company's operations and its affiliate, Jizhixie, which together manage approximately a quarter of Taiwan's social housing rental units, serving nearly 30,000 households. The crisis has prompted urgent responses from central and local governments, including the Urban Housing Development Center and six major cities, to ensure landlords receive rent and tenants are not displaced. These authorities are demanding strict monthly financial and performance reports from the management companies and are prepared to transfer operations to other firms if necessary to protect the interests of all parties involved. Acer, Zhaoji's second-largest shareholder with a 17.9% stake, initially attempted to restore confidence by appointing a new chairman and general manager with financial expertise. However, after discovering "internal management deficiencies," Acer swiftly withdrew its representatives from the leadership positions just days later. Despite the turmoil caused by the former chairman's alleged personal greed, Zhaoji's core rental management business appears financially sound. Acer's latest consolidated financial report indicated that Zhaoji Property Management generated a net profit of NT$123 million in the first half of the year, with Acer recognizing NT$24.31 million in investment income based on its shareholding. The company's paid-in capital is NT$370 million, and its earnings per share for the first half reached NT$3, indicating the business itself is performing well but has been negatively affected by the shareholder's personal financial crisis.