TAIPEI (Taiwan News) — The Shilin District Prosecutors Office on Tuesday indicted two executives and issued a wanted notice for OnePlus founder Pete Lau, alleging the Chinese smartphone firm illegally employed more than 70 Taiwanese engineers and funneled funds to support the operation.

Prosecutors said Lau conspired with a man surnamed Lin (林) and a woman surnamed Cheng (鄭) to set up a Hong Kong company under the OnePlus name in March 2014 and register a Taiwan branch in March 2015, per CNA. Cheng served as the legal representative, and in May 2019, “OnePlus” was replaced with “Sonar” in the companies’ names.

Between August 2015 and January 2021, prosecutors said, the company funneled more than NT$2.3 billion (US$72.93 million) to the Taiwan branch through a Hong Kong trading company, describing the transfers as “revenue from commissioned R&D and the sale of R&D results assets.” The funds were used to recruit staff in Taiwan, pay salaries, and purchase equipment.

During questioning, Cheng said she was a nominal legal representative who handled tax planning, was unfamiliar with the company’s operations, and did not receive a salary. She said the Taiwan branch’s only business was conducting R&D for OnePlus mobile phones.

Lin said he was appointed by Lau as R&D director and was responsible for interviewing and leading the team. He said the Taiwan branch never developed its own clients and that all operational decisions were made by Lau.

Witnesses said software developed by the Taiwan branch was used exclusively for OnePlus and Oppo phones. Administrative managers were also required to regularly report employee attendance and financial conditions to the Shenzhen headquarters.

After the investigation, prosecutors concluded that Cheng and Lin violated the Cross-Strait Act and charged them on Tuesday. Prosecutors also issued a wanted notice for Lau.