Updated: Panama papers II

6 04 2016

We continue to look for data on Thailand in the Panama Papers. So far we aren’t having too much luck. We were, however, reminded of an earlier report of some 600 Thais stashing loot overseas.

That 2013 report, also from the International Consortium of Investigative Journalists, included Pojaman Shinawatra, Nalinee Taveesin, Bhanapot Damapong, members of the Chirathivat family, Yuenyong Opakul, and note this very carefully, the Vongkusolkit family and Admiral Bannawit Kengrian.

The latter was described as “the former deputy permanent secretary of defense, who is listed as one of many shareholders in the British Virgin Islands company Vnet Capital International Co., Ltd in 1998” with 2006 coup connections and who is described in a Wikileaks cable as an acolyte of Privy Council President General Prem Tinsulanonda.

On the new release of leaks from Mossack Fonseca, the main new report we have seen was in the Bangkok Post. It states that the “Office of the Auditor-General has weighed in on the so-called Panama Papers, asking the Revenue Department to look into tax payment records of Thai nationals named in a list of people allegedly using a Panama-based law firm for offshore holdings.”moneybags 1

Yet, as might be expected in a country that is protective of its wealthy elites and ruled by a military junta, a cover-up seems likely, unless the junta can come across the names of those it sees as political opponents. At the moment, “Justice Minister Gen Paiboon Koomchaya and the business community are urging the public not to rush to conclusions and let regulators verify the information first.”

“Verify” sounds like “cover-up” or “manipulate.”

Like the rich everywhere, the first bleat refers to law rather than ethics: “… using offshore company structures is a normal and legal business practice.” Not paying tax is legal they say. In Thailand, tax, like so many other things, is malleable and politicized.

Recall that Thaksin Shinawatra’s sale of the Shin Corp involved tax havens. While he didn’t have to pay tax on the transfers in Thailand, there was an outcry over this, and the opposition to him was strengthened. Now, it seems, things are to be reversed. So much for Buddhist ethics and the “good” of “The Good People.”

The report says there are “almost 400 Thais among 780 individuals who used Thailand as a residence and 50 companies were named on the lists.” While it is stated that “[p]rominent names include well-known business people, politicians, a former military officer and celebrities…”, only a few names are named.

As the International Consortium of Investigative Journalists (ICIJ) observes, “there are legitimate uses for offshore companies and trusts and it does not intend to suggest or imply that those named in the leak have broken the law or otherwise acted improperly.”

General Paiboon said “… the leak is not verified information. But once it’s verified, no one can dodge an investigation. So let Amlo [Anti-Money Laundering Office] work on this first…”.

Our question is: Where are Thailand’s journalists who should be working on this? In most other countries, journalists are pouring out stories.

Auditor-General Pisit Leelavachiropas says “he has seen the list and had proceeded to ask the tax authority to review tax records to detect any possible wrongdoing.” He names no names.

Pisit also suggested that the “Centre for National Anti-Corruption (CNAC) can facilitate the probe by acting as a coordinator as it is the hub of 11 anti-corruption agencies.” Some of this group and Pisit were recently part of another cover-up, finding no corruption in the military’s Rajabhakti Park, while making “commissions” acceptable.

Now to some of the names and what they say.

Isara

Isara

One name in the Panama Papers is Isara Vongkusolkit, who is chairman of the Thai Chamber of Commerce. His response was to say that “he did not know and had noting to do with Mossack Fonseca. He was wondering how his name was mentioned on the lists.” Wondering? Really? He doesn’t remember the 2013 report?

He did admit that offshore banking and companies were necessary to avoid taxation in Thailand. He then went on to blame government for tax avoidance because it has had “high” tax rates!

The Vongkusolkit family maintains a tight set of relationships. One Chanin Vongkusolkit is a member of the Council of the Private Sector Collective Action against Corruption (CAC), which is:

an initiative by the Thai private sector to take parts in tackling corruption problem via collective action. The CAC aims to bring effective anti-corruption policy and mechanism into implementation by companies in order to create an ecosystem of clean business community.

Forbes says this of Isara and family:

To offset volatility in sugar prices, Isara Vongkusolkit’s privately held Mitr Phol Sugar, Thailand’s largest sugar producer, is expanding its energy business, which generates 400 megawatts of electricity, half for its own consumption. The company, which recently faced allegations of human rights abuses and illegal land- grabbing in Cambodia, said it was in discussions with the Cambodian government about its concessions. Brother Chanin stepped down as CEO of family’s Banpu, the country’s biggest coal miner, after running it for more than 3 decades.

Chanin remains on the Banpu Board of Directors. Others from the family on the Board are Buntoeng and Verajet Vongkusolkit. Australia’s controversial Centennial Coal Centennial is a wholly-owned subsidiary of Banpu.

Banpong

Banpong

The point seems to be that Isara and his family are fabulously wealthy Sino-Thai tycoons and like their ilk everywhere, seek to “minimize” tax while claiming to engage in ethical business behavior, if that is not an oxymoron.

Another listed is “Banyong Pongpanich, chairman of Phatra Capital and a member of the State Enterprises Policy Commission, posted a message on his Facebook page saying he was taken aback that his name was on the list.” Like Isara, he claims to not know Mossack Fonseca: “I have just learned of the company today and I never contacted or did any business with Mossack Fonseca…”.

Schultz

Schultz

We are reminded of Sgt. Schultz, again and again. How many times can “I know nothing” be used?

Patra Capital is a “certified” company at the Private Sector Collective Action against Corruption and Phatra Capital promulgates a Code of Ethics for Directors, Officers and Employees. In part, it states:

By adhering to exemplary standards and conducting our business with excellence and integrity, we enhance our reputation and cultivate the growth of our business. All of us must take personal responsibility for conducting ourselves in a way that reflects positively on the Capital Market Business Group and with the letter and spirit of the Guidelines for Business Conduct.

Like many of Thailand’s tycoons, Banpong has royal links, his with the Mae Fah Luang Foundation. He is also a member of the junta-created Superboard, which is said to be “overseeing all state enterprises has the stated aim of getting them all moving in the same direction towards strength and efficiency.” A Superboard of bankers, coal miners and more means endless conflicts of interest.

Both the Vongkusolkit and Pongpanich families are represented on the Board of Trustees of the royalist Thailand Development Research Institute, which has often commented on corruption and ethics in Thailand’s politics.

Bannawit

Bannawit

The last Sgt. Schultz excuse came from Admiral Bannawit Kengrien. The “former deputy defence permanent secretary, whose name is also on the lists, said this came as a surprise to him…. According to the retired officer he never conducted any business transactions overseas or given permission to anyone to use his name to set up offshore accounts.”

Bannawit has appeared previously at PPT as one of “Dad’s Army,” which was an elite forerunner to the more popular People’s Democratic Reform Committee in trying to bring down the elected government of Yingluck Shinawatra. He was a member of several other yellow-shirted and royalist groups that sought to create conflict with the Yingluck government. Earlier, he was previously a member of the assembly appointed by the junta in 2006 and then caused controversy when deputy defense minister. He was not averse to very odd and racist claims when opposing red shirts.

Bannawit also seems to have conveniently forgotten the 2013 leaks from the British Virgin Islands. Or perhaps the rich and powerful expect the junta to enforce collective amnesia on the country.

Update: Khaosod has cast doubt on the Bangkok Post story, above, saying that the newspaper (and many others) confused the 2013 leak with the Panama Papers. INterestingly, whether its 2013 or now, nothing in our post would seem in need of change.





With a major update: Clean as a whistle

25 03 2016

The Corruption Park scandal is said to be officially over. It wasn’t necessarily always so simple. At the beginning of the affair, it was caught up in claims over corruption by some close to the palace or parts of it. Even the person at the center of investigations, former Army boss and junta member General Udomdej Sitabutr, admitted that “commissions” had been paid and then “repaid.”

Their were also conflicts within the junta and the military as Udomdej was “targeted.” Importantly, though, Udomdej was strongly supported by senior junta mover and shaker General Prawit Wongsuwan, who made it clear that he wanted his loyal underling cleared.

Khaosod reports that yet another junta-commanded corruption “investigation” has found “[n]o trace of corruption or malfeasance … in the construction of a royal monument … as widely alleged in media reports, a junta-appointed committee declared…”.

Corruption

Auditor-General Pisit Leelavachiropas was precise: ““There was no violation of bureaucratic procedure” following an inspection of “more than 95 percent” of all documents available.

Well, clear about the limited parameters of the “investigation.”

Many of the allegations revolved around “commissions” paid to Watcharapong Radomsittipat or Sian U, and amulet dealer. However, that dealer had already been “cleared” by the Office of the Auditor-General of “allegations he demanded kickbacks from foundries hired to cast the statues of seven Thai kings at Rajabhakti Park…”. That was more than a month ago.

At the time, the trader “admitted he received a total of 20 million baht from the foundries, but the money was paid for his role as their adviser, coordinator, work supervisor and problem solver…”. According to Auditor-General Pisit, these were “management fees,” not “kickbacks…”.

According to the OAG, the trader “decided” – when? under what pressure? – to “return the money to the foundries because he preferred to help build the park as a volunteer.” Yeah, right…. He claimed “the foundries did not want the money back, so Sian U donated it to the Rajabhakti Park project.” Yeah, right….

Sounds more like a cover up to us.

This “investigation” of the trader was carried over into the broader “investigation” with the same story claimed by the Auditor-General.

This rather dubious “investigation” was sufficient, however, for General Prawit. The Bangkok Post reports that Prawit declared: “It has ended…”. He said Army commander Theerachai Nakawanich, who “was reported to have pushed the issue into the spotlight and wanted an investigation into the project” if it was “ended.” He replied it was ended.

The boss hopes that’s the case. The military is now going to go ahead and spend even more money on Corruption Park.

Update 1: A reader points out our failure to note that at least two senior military officers, linked to Udomdej, fled Thailand over the the murky events surrounding the Corruption Park scandal and Bike for Mom and Bike for Dad events. With the junta in place, truth on this case will be mediated by self-interest.

Update 2: It is interesting to note that the Bangkok Post has an editorial that criticizes the decision that all is “squeaky clean.” It refers to a “perilous” and “dangerous precedent.”

It states that the “CNAC, chaired by Justice Minister Paiboon Koomchaya, comprises all major state corruption busters including the PACC, the National Anti-Corruption Commission (NACC) and the Office of the Auditor-General (OAG). Its approval should have restored the tainted park to the glory it deserves.” Yes, we know, the last statement is the required royal ridiculousness.

The editorial continues:

Unfortunately, the coalition of public graft-busting organisations let the public down when it resorted to euphemism and round-about explanations instead of tackling the accusation squarely and straightforwardly.

In short, the the CNAC found out five foundries paid about 20 million baht to the amulet trader identified as Sian U for “recommending” the jobs of casting oversized statues of past monarchs at Rajabhakti Park to them. The amount is also considered remuneration for advice that Sian U gave to the foundries during the casting process, according to the CNAC.

For most people, a payment given to people who recommend jobs or serve as a sales facilitator is called a commission.

The CNAC, however, seemed to go out of its way to gloss over the dubious practice in its Wednesday announcement.

The coalition of graftbusters said the money was paid between private parties. It reasoned the rate was in line with market prices, and that the amulet trader had enough expertise to serve as a consultant to the foundries.

These explanations are not relevant to the central question regarding the kickbacks scandal.

… What gave the amulet trader the authority to “recommend” jobs in the state project to private businesses? Why was he allowed to make money as a go-between when the process of finding contractors to cast the park’s statues should have been carried out in an open and fair manner in compliance with state procurement practices? What connections did he enjoy with the army that allowed him to claim he could “recommend” its jobs to private business?

More importantly, the CNAC acknowledged that the Sian U was later told by the army not to keep the money so he donated it back to the Rajabhakti Park fund. If the money was a clean, aboveboard business transaction, why did the army have to tell the amulet trader to “donate” it?

Sadly, the CNAC did not appear to pay attention to any of these crucial questions as it explained away the scandal with irrelevant facts. Worse, by suggesting that it is acceptable for people to charge money by recommending jobs in state projects to private businesses, the graftbusters are opening up vast new areas for fraud and deceit.





Updated: Questions and “investigating” Corruption Park

27 02 2016

Just a few days ago, Deputy Defense Minister General Udomdej Sitabutr was reported as declaring himself as being in the clear on the Office of the Auditor-General’s “investigation” of Corruption Park. Udomdej stated that the Auditor-General “has found no corruption in the Rajabhakti Park project…”.

Yet, just a couple of days later, Channel NewsAsia reports that Justice Minister General Paiboon Khumchaya has “asked the Office of the Auditor General (OAG) to further investigate alleged irregularities … in order to clear lingering public doubts about claims of corruption and kickbacks.”

Army at the park

Why does Corruption Park refuse to go away? Who is keeping it on the political agenda?

As the report states, the “funding for the project, … in a 35.5 hectare military property, has been linked to allegations of involved military officers having privately benefited from the construction of the park.”

Why is that the Minister has asked for more investigations from the Auditor-General when it has “already finished its investigation into the project and concluded that all procedures were followed correctly.”

Paiboon states that “not all questions have been answered and that there are still three to four unresolved issues.” He is not saying what these issues are. He is not saying why previous “investigations” have left these unresolved.

Why is Paiboon continuing investigations when the junta has previously tried to cover-up?

We don’t know the answers to the questions raised above nor to other questions.

Are there splits in the junta? Is a faction in the military seeking to get rid of Udomdej? Why are investigations continuing even after Crown Prince Vajiralongkorn has been a sponsor of the Foundation associated with the Park? Why has the junta been so agitated by a Facebook page posting about military officers associated with the scandal who have fled the country?

Update: The Bangkok Post has an editorial on Corruption Park. It begins: “Justice Minister Paiboon Koomchaya is correct. The public must be given full details about the construction of Rajabhakti Park, especially in areas where corruption is alleged to have taken place, before they can decide if the project is clean.” It observes:

Some people might regard Gen Paiboon’s reaction as possibly stemming from a personal agenda between him and former army chief Gen Udomdej…. Both Gen Paiboon and Gen Udomdej were tipped to become army chief after Gen Prayut Chan-o-cha retired two years ago. Although the top post went to Gen Udomdej, the sense of rivalry has reportedly lingered.

The Post rejects this. It accuses the Attorney-General’s office of an essentially biased and/or incompetent and far too limited investigation.

Meanwhile, a Bangkok Post story has more details on the flap about corruption in the military and involving the monarchy. It is a confusing and confused story, but emanating from within the military.While unstated in the

Given the incompetence of the police and authorities in “investigating” anything, the huffing and puffing is amusing: “Authorities plan to shut down a Facebook page that allegedly spread false information on two key lese majeste suspects in an act police believe was aimed at confusing their investigation.” Lies and confusion are the stock in trade of the uniforms in Thailand. The claim is that there are “50 people thought to be telling lies about suspects’ whereabouts…”.

The “suspects” are Colonel Khachachart Boondee and Major General Suchart Prommai. Why 50 others should be covering for them on Facebook and “misleading” so-called investigators is not stated. The “investigation” now seems to focus on a Facebook page rather than the alleged crimes.

The story states that the suspects are accused that “they solicited money which they claimed would be used to fund the production of T-shirts for the ‘Bike for Mom’ cycling event in August last year.” However, Colonel Khachachart Boondee, has also been mentioned as close to General Udomdej….





Udomdej wraps up investigation of himself

23 02 2016

Many strange things happen under the military dictatorship. But the reporting of the outcome of the Office of the Auditor-General’s “investigation” of Corruption Park, involving Deputy Defense Minister General Udomdej Sitabutr, takes the cake.

UdomdejThis report states that the Auditor-General “has found no corruption in the Rajabhakti Park project…”. Who is the source of this information? The Auditor-General? No. The spokesperson for this is none other than General Udomdej, chair of the Rajabhakti Park Foundation, and one of those at the very center of the investigation!

General Udomdej declared: “Senior officials of the Office of the Auditor-General (OAG) have wrapped up the investigation and concluded that all procedures had been followed correctly…”.

We don’t doubt that this would be the result because the junta and Udomdej have worked exceptionally hard to clear his name and to distance Udomdej from allegations of links to others who were accused of lese majeste.

Udomdej ticked off his own work, adding that an “investigation” by his buddies at the Royal Thai Army and the Defense Ministry had “also confirmed there had been no irregularties in the scheme and all activities had met the criteria stipulated by the Prime Minister’s Office…”.

Only the politically-pliable National Anti-Corruption Commission is still examining the project. No one should expect any surprises there.

Udomdej says he wants the investigations to finish so that he can have his pet project move on to build yet another “museum and an exhibition centre … [on] contributions of all former Thai kings…”. Monarchy museums seem to be the only kind of museum developed in Thailand these days.





The “consultancy” on Corruption Park

19 02 2016

The Nation has a report on “investigations” into Corruption Park.This is one of the first stories since Crown Prince Vajiralongkorn was announced as a patron of the park.

We have trouble following it, but as it refers to the mysterious “amulet trader,” we thought some readers will find it useful.

The report refers to the “amulet trader at the centre of the Rajabhakti Park scandal” and says he “has denied demanding bribes from the casters of the giant statues of great kings, testifying that Bt20 million was donated to the park in Prachuap Khiri Khan on behalf of the five foundries.”

It turns out that the “amulet trader” also owns a foundry. It isn’t clear if this is one of the foundries making the statues of dead and one live king.

We guess this is trying to marry a story to Deputy Defence Minister General Udomdej Sitabutr’s claims about “donations.”

This “investigation” is by Auditor-General Pisit Leelawachiropas who went on television to disclose (why?) that the “trader presented evidence of his services for the five foundries involving advising on, supervising and solving problems with their work.”

Amulet trading seems to involve skills one would not necessarily assume. More, he claims that these unusual skills were paid at “Bt20 million in instalments as consulting fee and for expenses.” That’s quite a fee!

The Auditor-General’s Office seems to buy this story and the remarkable claim that the 20 million was first used to “construct a temple” but that the “trader” then had second thoughts (was there a gun involved, pointed at him?) and then “transferred the money via his foundry’s bank account to the park fund…”.

It is a strange series of events.





Replacing the king II

17 01 2016

In an earlier post PPT commented on how the Constitutional Court was being set up in the draft constitution in ways that transferred some of the king’s formal and “informal” political power to the court.

The idea is that the current monarch could (kind of) be trusted to do the right thing by the elite that craves economic and social power. No one is exactly sure where the next king will take things, so the institutionalization of elite political desires is the strategy for insuring the future. This doesn’t mean dumping the monarchy, just making sure that political power doesn’t depend on an undependable monarch (and the Chakris have had a few).

It seems that the royalist charter manipulators are doing even more to ensure the stability of the social, political and economic order. The Nation reports that other “independent agencies” are being given additional power.

Of course, none of these agencies are in fact “independent” as all are controlled by the royalists.

The charter fixers have decided that the Election Commission, National Anti-Corruption Commission and Auditor-General can be “more proactive under the new charter and free to initiate inquiries without complaints being filed…”.

Considering the sometimes extra-legal roles these organizations have played in bringing down several elected governments, this is likely to be seen by royalists as a great move. For anyone with any remaining hope for Thailand’s democratization, this will be a bitter blow.

Constitution Drafting Commission chairman Meechai Ruchupan says that these unelected bodies “could give warnings to the Cabinet in cases where its policies or actions could potentially cause trouble for the country.” In other words, elected governments will always be overruled by unelected royalists.

This “warning” would be “a resolution of all three commissions,” and while a government could ignore the warning, the failure to heed the warning would certainly see the government fall. This is the “crisis committee” in the sense that a warning would create a crisis. A crisis could be created from a media report that one of the agencies decided to “investigate.”

Meechai said the ” independent agencies” would not be subject to any scrutiny. According to Meechai, they would “check themselves” through “a legal code on ethics.” Just for a bit of extra elite control, this “code” would also be applied to “parliamentarians and the Cabinet.”

Elected politicians simply cannot be trusted because they respond to the riff-raff who elect them.

In line with this, The Nation also reports that MPs and Cabinet members can be banned for life from politics if they are “found to have proposed a motion concerning annual state budgets in favour of other members…”. They will be removed from office and also “have to repay the money spent in relation to the project or projects they had voted for…”. More draconian, if the “malpractice concerned a particular Cabinet member, the whole Cabinet could be subject to removal from office as well.”

Exactly how this might be defined and who would decide on a breach is not explained except that another group of unelected royalists will come up with “the principles of financial discipline” to regulate government spending.

In essence, as we predicted some time ago, the idea is that elected politicians will not be able to campaign on a policy platform and implement it without the approval of the unelected.





Article 44 used for money-making by the junta

8 01 2016

There has been quite a bit of debate and editorial comment on the military dictatorship’s move to neuter and take over the Thai Health Promotion Foundation (ThaiHealth). PPT hasn’t followed the mini-coup all that closely, but a few lines in a report today suggested a reason for increased interest.

As far as we can tell, ThaiHealth has been quite successful. Yet a couple of days ago, The Dictator used the draconian Article 44 to suspend seven board members of ThaiHealth along with 52 other “state officials ordered to leave their duties pending probes, mostly concerning alleged irregularities and malfeasance.”

A junta “investigation” reckons that the organization’s budget last year was misused.The junta claims conflicts of interest. (PPT can’t imagine the junta turning the same lens on itself, for the regime is riddled with such conflicts. Just another example of double standards.) In fact, a Bangkok Post report makes it clear that the board members followed the “rules” on conflicts of interest.

Rabid rightist-royalists have condemned ThaiHealth [clicking this link takes the reader to a very strange conspiratorial world linking Oregon and Bangkok] as a kind of NGO-cuddling cabal somehow linked to international and US-based organizations undermining the world and Thai sovereignty. Even the Puea Thai Party has got into the act on ThaiHealth.

According to the Bangkok Post story linked above, a government source says that ousting the board members will “provide an opportunity for the government to change rules governing the agency’s spending so it can use the money to fund the regime’s projects.” No conflict of interest there….

As well as getting its hands on the “sin taxes” that funded ThaiHealth, this move also allows the junta to twist a knife into some of the organizations it sees as too liberal and thus untrustworthy or as oppositional.

Vichai Chokevivat, the ousted deputy board chairman, sees that the junta has targeted ThaiHealth: “He said the charter writing panel headed by Borwornsak Uwanno attempted to take away the earmarked taxes from ThaiHealth last year and force the agency to obtain funds from the fiscal budget in the future.” When the charter writers backed down “the Office of the Auditor-General and the military regime’s panel investigating suspicious spending of state funds stepped in…”.

While not all anti-military, a bunch of groups targeted in this move include irritant groups like Isra News. It has been received some funding from ThaiHealth and has exhibited an interest in the junta’s wealth and military spending. ThaiPBS has been seen as unreliable for the junta and it also received some funding. The Komol Keemthong Foundation also received some funds, and that is associated with Sulak Sivaraksa, considered a thorn in the side of palace and military for many years. Also funded was the October 14 Foundation is generally considered a pain for the military, who, of course, have never massacred students.

More interesting are the foundations from the royalist side that have been supportive of the 2006 and 2014 military coups and which have been funded by ThaiHealth. The Rural Doctor Foundation has supported both military coups and is associated with the aged royalist busybody Prawase Wasi. That said, it tends to be supportive of the universal health program the junta would dearly love to scrap. Then there is the Thai Rural Reconstruction Movement, which is now miles removed from the ideals it was set up to achieve more than 40 years ago. Now run by a bunch of aging bureaucrats, minor princes and royalist propagandists for the loopy sufficiency economy idea.

It will be interesting to see how these organizations respond to the use of Article 44 to target them in a “case” that would appear concocted in order to serve the junta’s interests.








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