CNN's B140m bill triggers Elite probe

Major contracts signed without authorisation

POST REPORTERS

The global news service CNN has submitted a 140-million-baht bill to Thailand Privilege Card Co for advertising, prompting an investigation into how the state-owned company has run up such high marketing expenses with questionable internal controls.

In announcing the investigation, state officials said there were instances where spending approvals reportedly were not signed by any authorised parties at the state-owned company.

Thailand Privilege Card currently owes a total of 200 million baht to CNN, ad agencies and other media outlets.

The company was established to promote the one-million-baht Thailand Elite Cards, a loyalty programme aimed at wealthy foreign executives and tourists and offering special privileges ranging from fast-track immigration procedures to discounts at golf courses and hotels.

Somchainuk Engtrakul, the chairman of Thailand Privilege Card and permanent secretary to the Finance Ministry, said that his deputy, Boonsak Jiampreecha, would investigate the circumstances regarding the CNN advertising bill.

Mr Boonsak is also on the audit committee of Thailand Privilege Card.

Mr Somchainuk stressed that the company had no financial difficulty in meeting its commitments, considering that with 660 cards sold to date, it effectively had funds of 660 million baht in hand.

``What I am going to do is investigate details of what has happened. The Elite Card should not have incurred such huge foreign advertising costs,'' he said.

``It's not the money. The money we'll have to pay.''

Mr Somchainuk said an invoice submitted to Thailand Privilege Card did not stipulate who had authorised the commercial spots, resulting in a reluctance by officials to pay the bill.

``As a result, CNN submitted a letter directly to [Tourism and Sports Minister] Sonthaya Khunpluem asking for the payment,'' he said.

Board members, as well as Mr Sonthaya, noted discrepancies in how ad bookings were handled by Thailand Privilege Card. Some invoices clearly showed the official who had authorised the ads while others did not.

Members of the audit committee plan to investigate why some ads were run even without explicit written authorisation, as well as why, if airtime had been purchased, no company official had signed to take responsibility.

They also want to know why CNN chose to run the commercials if the contracts were incomplete since they lacked official authorisation.

Mr Boonsak said he would submit his report by next Wednesday.

He said the 140-million-baht bill was not for CNN only, but also for advertising in other media within the Time Warner group, including Fortune and Time magazines.

Other bills were outstanding to a number of publications in Japan, as well as 50 million baht owed to various agencies for production costs of the various advertisements.

Officials said most of the expenses had been incurred last year at the onset of the Elite Card project.

At the time the advertisements were purchased, Juthamas Siriwan, the governor of the Tourism Authority of Thailand, was the TPC chairwoman and Paisith Kaenchan was acting managing director. Both have since resigned.

Both Mrs Juthamas and Mr Paisith have said that the international media buying had been done in a hurry to meet tight schedules around the launch of the card.

Chotsiri Rodboonpa, the current TPC managing director, acknowledged that it was unusual for advertising to have been purchased without proper documentation.

The Elite Card project, the brainchild of Prime Minister Thaksin Shinawatra, was launched in 2003 as part of an initiative to develop the country's tourism sector.

But the project has fallen considerably short of its original target of one million cardmembers within five years. Officials recently revised the 2004 sales target to 3,000-5,000 members.

Mr Somchainuk stressed that the company had no financial difficulty in meeting its commitments, considering that with 660 cards sold to date, it effectively had funds of 660 million baht in hand.

Must be a good business with zero operating expense.

OPPS......Maybe a lottery to pay off the debt??

Ha ha ha ha ha ha ha ha....

this report is so funny... more egg for Thaksin's face.

One of his many "house of cards" to start falling down.

Mr Somchainuk stressed that the company had no financial difficulty in meeting its commitments, considering that with 660 cards sold to date, it effectively had funds of 660 million baht in hand.

Must be a good business with zero operating expense.

Don't forget Lop that they gave away a lot of memberships as a promotional activity. Mine must still be in the mail. That equates to even less earnings for the card company It seemed a good idea at the time.

Their stylish premises on Sathorn Road must be costing them a pretty penny. Not to mention the glass boxes (aka "lounges") they have constructed at Don Muang for their members (still haven't seen one of these members...and when I asked the immigration officer at the "Thailand Elite" line whether he'd ever seen one, he just laughed!).

I'm waiting for Thaksin to proudly proclaim as did against the U.N., that

"CNN is not our father"

And where is Mr Big, as we speak ?

Living in a tent on the new runway waiting to greet the first Elite Cardholder.

I would be happy to take on this Elite Card business (less the existing liabilities!), and show just how they should have run the business!! Forget all these wasteful expenses! I have a cheap but ok office in Silom that costs 10,000 baht each month all-in.

Perhaps Taksin should have given the responsibility of running this business to someone who was actually competent at runing a business, rather than just chucking good money after bad...

(It gets me quite angry to see how much of a cock-up they have made of all this. Perhaps I should be a politician...)

The worst figure I heard on Thai Visa, was 9 cards sold.

Considering that in here are at least 3 members who outed themselves ,

I know one more personally, I believe the figure is too low.

Now they say 600 sold, discount the BS-rate of 30% makes roundeabout 400 million Baht in the pocket.

If anything goes, let me run the operation with a staff of 10, I will sell 100 cards in 6 months and retire with 40 million Baht after deduction of costs.

The global news service CNN has submitted a 140-million-baht bill to Thailand Privilege Card Co for advertising, prompting an investigation into how the state-owned company has run up such high marketing expenses with questionable internal controls.

I suppose that since CNN is not allowed pass-through advertising in Thailand via UBC, the powers-that-be could simply deny that this advertising even aired.

They also want to know why CNN chose to run the commercials if the contracts were incomplete since they lacked official authorisation.

See, this was actually all CNN's fault.

The global news service CNN has submitted a 140-million-baht bill to Thailand Privilege Card Co for advertising, prompting an investigation into how the state-owned company has run up such high marketing expenses with questionable internal controls.

I suppose that since CNN is not allowed pass-through advertising in Thailand via UBC, the powers-that-be could simply deny that this advertising even aired.

They also want to know why CNN chose to run the commercials if the contracts were incomplete since they lacked official authorisation.

See, this was actually all CNN's fault.

Of course it was. CNN aired the stuff without the order form being signed by the PM's maid or driver.

CNN is particularly known for being rife with corruption and dodgy business practices. l am confident its all their fault. I also like the part about it being the fault of the original director who resigned over a year ago, must be CNN's fault again for waiting so long to invoice.

this report is so funny... more egg for Thaksin's face.

Now I know Thaksin has a big, fat, round face, but just how MUCH egg can it hold?

Article Title:

Egg on govt’s face after clumsy mission

http://www.nationmultimedia.com/page.news....20941&usrsess=1

Here's to hoping one of the bird flu-contaminated eggs hits his face.

discount the BS-rate of 30%

LOL..... that struck me as a very funny line, Axel.... thanks for the good laugh this morning..

is that some official government rating? like the prime lending rate? LOL

or does it float up and down like the baht/dollar exchange rate? LOL

LOL.... thanks again