JKOPAY founder Hu Yi-chia loses lawsuit against financial regulator

Hu Yi-chia, the founder of the popular mobile payment service "JKOPAY," has definitively lost his legal challenge against Taiwan's Financial Supervisory Commission (FSC). The dispute centered on his removal as a director of JKOS Securities in 2021, a decision the FSC made due to significant financial shortcomings linked to the company's "Tuofubao" product.

The FSC's action followed an investigation that identified multiple issues with JKOS Securities' collaboration with "Tuofubao." These included advertising guarantees of profit and promises of quick buybacks, which are prohibited practices. Furthermore, the company engaged in a fund-linked service resembling quick buybacks without proper internal approval or board resolution. The FSC also found that JKOS Securities concealed information from the commission and failed to appoint qualified personnel to manage its affairs, with one individual simultaneously holding both director and general manager positions, actions deemed detrimental to sound corporate governance.

Hu Yi-chia contested the FSC's decision, initiating an administrative lawsuit to have the penalty revoked. He argued that he controlled JKOS Group's operations and was instrumental in developing "Tuofubao" as a Taiwanese equivalent to China's "Yu'ebao." The Taipei High Administrative Court ruled in November 2023 that the FSC's sanctions were justified, finding that Hu's actions, particularly his unilateral decision to launch "Tuofubao" despite its non-compliance, violated corporate governance and financial regulations. The court noted that Hu's approach circumvented banking supervision and exposed public assets to risk.

In his appeal to the Supreme Administrative Court, Hu Yi-chia sought to overturn the previous ruling. However, the court on Tuesday dismissed his appeal, affirming the lower court's findings and the FSC's disciplinary action. The Supreme Administrative Court concluded that the original judgment correctly applied the law and facts, leaving Hu Yi-chia with a final, confirmed defeat in his legal fight against the financial regulator.