Troubled Taiwanese consumer electronics manufacturer, Benq, has been hit by further bad news after prosecutors briefly detained and questioned its Chairman and president as part of an insider trading investigation.

The company's chairman, KY Lee, and president, Sheaffer Lee (no relation), were released on bail totaling three quarters of a million dollars after facing more than five hours of questions from investigators in Taiwan, according to local press reports.

Chairman Lee offered to quit last month to take responsibility for Benq's disastrous investment in Siemens' mobile handset division, which has cost Taiwanese manufacturer more than $1bn in losses over the past year.

The insider trading investigation appears to relate to a period in early 2006, not long after Benq took over the loss-making Siemens unit, and subsequently reported its own first ever quarterly loss. Consecutive loss making quarters followed, continuing even after Benq cut off financial support to the Germany-based handset unit late last year. The unit then filed for bankruptcy.

Benq's CFO, Eric Yu, has been detained since last month by prosecutors investigating the case, and unlike his fellow executives, requests for release on bail have not yet been granted.

BenQ manufactures and markets a wide range of PC peripherals and consumer electronics products, such as digital cameras and LCD monitors. The company continues to manufacture mobile phones in Asia, despite cutbacks following its problems in Europe.

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