Taiwan IC substrate giant Unimicron has been accused of relabelling circuit boards made in China as "Made in Taiwan." Prosecutors have searched the company and released senior executives on bail — bad news for shareholders and for the ETFs that have bet heavily on the stock.

• The Taoyuan District Prosecutors Office found 14 people involved in forgery of documents and false labelling of goods; five were released on bail, with the president of the PCB business division posting the highest amount at NT$15 million.
• The share price had just hit a record high before the news broke, then plunged sharply in late trading on Friday, leaving investors worried it could be cut in half.
• Several actively managed ETFs are heavily weighted in Unimicron, with the largest holding more than 20,000 lots, and are coming under pressure as a result.
• Wang, the president in question, twice reduced his holdings of the company's shares in the first half of this year, selling about 11,000 shares in total — timing that has raised questions.
• The United States continues to tighten its containment of the "red supply chain," and the grey area Taiwanese manufacturers once operated in between the two sides of the strait is disappearing.

Outlook: The market will be watching Monday's opening closely. If US clients shift orders elsewhere, competitors Kinsus and Nan Ya PCB could benefit.