Saxena Faces First Charge

[webfact]

BBC COLLAPSE

Saxena faces first charge

By Kesinee Taengkeaw

The Nation

Published on October 31, 2009

PM vows prosecution will be free from political meddling OAG will pursue his $20m assets in UK and Switzerland

The Office of the Attorney-General will file the first of 20 embezzlement charges against Rakesh Saxena, the man allegedly instrumental in bringing about the collapse of the Bangkok Bank of Commerce, immediately after the police interrogate him.

Police are seeking the court's permission to hold Saxena on remand, while the OAG will ask the court to deny him bail.

"The case will proceed immediately, and the filing will definitely be made before the statutory limit on July 20, 2010," said deputy attorney-general Seksan Bangsombun, who is in charge of economic and resource cases.

The office began the manhunt for Saxena in 1996.

Attorney-General Julasing Wasansing said the office is prosecuting 20 cases against Saxena for causing damage of more than Bt10 billion to BBC. The cases are currently at the documentation stage.

Other alleged accomplices have already faced charges.

In its extradition case against Saxena, the OAG focused only on the loan to City Trading, but it will later inform the Canadian authorities about the additional 20 cases, in line with the extradition agreement.

Julasing described Saxena as being in a frail condition and needing help in standing, but having given full cooperation to Thai officials since losing his extradition battle.

The attorney-general also thanked all concerned for their cooperation during the 13-year extradition saga.

"The office will further pursue Saxena's remaining assets worth more than US$20 million [bt669 million] in the UK and Switzerland. It should take a while," he said.

In the initial case, Saxena and then-BBC president Krirk-kiat Jalichandra were alleged to have jointly approved a Bt1.66-billion loan to City Trading.

The amount was beyond their authority and was not based on correct asset evaluation, thus violating the Criminal Code's articles 83, 352, 353 and 354 and the Securities and Exchange Act's articles 307, 309, 311, 313 and 315.

The Bank of Thailand and the Stock Exchange of Thailand yesterday promised full cooperation to the prosecution, standing ready to supply evidence and witnesses.

Meanwhile, Prime Minister Abhisit Vejjajiva vowed to prosecute any politicians found linked to the BBC banking fraud case in 1996, dismissing concern about fixing the legal proceedings for the sake of political expediency.

"There is no cause for concern because everything will proceed in accordance with evidence," he said.

Saxena has boasted of having political contacts with the now-defunct faction known as the "Group of 16", which has morphed into various coalition cliques, including the current Newin Chidchob faction.

Abhisit said the prosecution of Saxena would be based on the rule of law and free from political meddling.

The government will not play a political game in connection with the fraud case in 1996, Deputy Prime Minister Suthep Thaugsuban said yesterday, echoing his boss. Although he led the censure debate in the House that subsequently exposed the BBC fraud, he would not get involved in the prosecution of Saxena, he said.

Suthep also dismissed speculation that the Democrats might exploit the case as political leverage to rein in coalition allies with linkage to the fraud.

"At the time of the incident, the Democrats did their job as opposition lawmakers and the case has moved on to the prosecution stage, in which justice should be allowed to run its course," he said.

As the case came to light when the disbanded Chart Thai Party was in power, the then prime minister Banharn Silapa-Archa was in charge of initiating the legal proceedings on the banking fraud, Chart Thai Pattana Party spokesman Wachara Kannikar said.

Wachara called on the authorities to get to the bottom of the fraud and prosecute all culprits regardless of their political connections. He denied that his coalition party, which is the reincarnation of the disbanded party, was trying to shield politicians linked to the fraud.

"The case should be prosecuted to the full extent of the law because society is waiting to see whether Saxena is the final culprit or a precursor to a long list of culprits," he said.

-- The Nation 2009/10/31

[webfact]

Group of politicians and associates borrowing money from BBC

By The Nation

Published on October 31, 2009

The following are Group of 16 politicians and their associates who borrowed from the Bangkok Bank of Commerce before its collapse.

1 Suchart Tancharoen borrowed Bt117 million for himself and Bt4.02 billion for his business

2 Newin Chidchob, Bt89 million

3 Chattawat Muttamara, Bt2.32 billion

4 Chuchart Harnsawat, Bt978 million

5 Thanee Yisarn, Bt103 million

6 Sonthaya Khunplome, Bt36 million

7 Chamlong Krutkhunthod, Bt3 million

8 Pairote Piumpongsarn, Bt1.79 billion

9 The Makhaisaw group, which was close to Suchart Tancharoen, Bt2 billion

10 Saudi billionaire Adnan Khashoggi, Bt3.30 billion

Note: Some debtors have repaid their loans while others are in the process of debt restructuring.

-- The Nation 2009/10/31

[brahmburgers]

The following are Group of 16 politicians and their associates who borrowed from the Bangkok Bank of Commerce before its collapse.

1 Suchart Tancharoen borrowed Bt117 million for himself and Bt4.02 billion for his business

2 Newin Chidchob, Bt89 million

3 Chattawat Muttamara, Bt2.32 billion

4 Chuchart Harnsawat, Bt978 million

5 Thanee Yisarn, Bt103 million

6 Sonthaya Khunplome, Bt36 million

7 Chamlong Krutkhunthod, Bt3 million

8 Pairote Piumpongsarn, Bt1.79 billion

9 The Makhaisaw group, which was close to Suchart Tancharoen, Bt2 billion

10 Saudi billionaire Adnan Khashoggi, Bt3.30 billion

Note: Some debtors have repaid their loans while others are in the process of debt restructuring.

-- The Nation 2009/10/31

Be interesting to know who has paid back and who has filched on their loan agreements. Better yet, would be a 'before and after' video of each person. The 'before' video would show them at the bank when they first apply for the load. All business suits, smiles, politecisms up the kazoo. The 'after' video would show them, years later, answering the phone when an underling bank officer calls to ask whether they could make a payment on the loan: "Who the heck are you? Do you know who I am? Do you know how important my family is, and how I could get you fired in one minute? Don't you ever call me again at this number, or I'll have your head on a stick, do you hear me?!"

I'm sure we've all thought of that at one time or another: getting loans for as much as possible and then riding fast in to the sunset, trying to stay incognito. When I left Wash.DC for the final time, on my way to California, it was 1974 and I was 22 years old, there was two final month's left to pay on the house rental. I could have easily just driven off and not paid that $660, but didn't.

Speaking of filching on loans, there's the story Mrs Kankanit aka Panjit (daughter of former Petchaburi MP Piya Angkinant) who borrrowed 8.2 billion baht, and then tried to fake her death - using a corpse from the tsunami.

What is it with Thailand? I know there are mechanisms to ensure the rich continue to get richer (while the downtrodden eat dirt), but 8.2 billion baht, that's insane! Where do Thai bank officers get schooled - at the University of Ridiculousthani? ....or the College of Padtherichlagong?

[hammered]

The group of 16 thing is interesting. They first came to light when annmouncing corruption in Chuan One Democrat government, and this really briought them to light and political influence. Then of course the Democrats had the next laugh with the BBC case. Now the Democrats are linked to several of the group although not all. Interesting how politcal enemies become politcial allies at least to some degree. PTP believe this will all strengthen the Dem hand in the coalition.

What would be interesting, and unfortuantely I dont have time to do it, would be to trace where every member of G16 is now and who they are linked to politically.

Newin we know is banned but with links to BJT

Sonthaya we know is banned but with familial links to Chart Thai

The rest.......

[gotlost]

Well the wheel clamp his wheel chair?

[BanTamo]

Ah but them were heady times. I long to have them back! Khun Kriang at SCB, Julaporn at SCIB, my THB visa card from TFB - what a party those years were! BBC? That bank was only for the silly deals!

[Old Man River]

The group of 16 thing is interesting. They first came to light when annmouncing corruption in Chuan One Democrat government, and this really briought them to light and political influence. Then of course the Democrats had the next laugh with the BBC case. Now the Democrats are linked to several of the group although not all. Interesting how politcal enemies become politcial allies at least to some degree. PTP believe this will all strengthen the Dem hand in the coalition.

What would be interesting, and unfortuantely I dont have time to do it, would be to trace where every member of G16 is now and who they are linked to politically.

Newin we know is banned but with links to BJT

Sonthaya we know is banned but with familial links to Chart Thai

The rest.......

It is all politics. It always politics. We all know about BBC and Fin One and a few others, but what about all the rest? How many of the defaulting borrowers on billions of THB in loans from numerous other financial institutions were and/or are now involved in politics? We will never know.

[webfact]

RETURN OF SAXENA

The road to scandal

By The Nation

Published on October 31, 2009

Thanong Khanthong examines the Bangkok Bank of Commerce saga, which emerged as the ailing symptoms of the 1996.

A turning point at the Bank of Thailand in mid-1996 revolved around the Bangkok Bank of Commerce (BBC).

With the credibility of the BOT hit hard, governor Vijit Supinit was forced to resign on July 1, 1996, bringing an abrupt, but hardly surprising, end to his six-year reign.

Vijit had become embroiled in the BBC scandal. The BOT had looked the other way while the rogue bank got itself into trouble dabbling in high finance. Most of its loans went towards stock-market speculation and takeover deals, as well as to politicians (at cheap rates). As the stock market headed downward, BBC quickly lost its capital.

But the central bank assisted BBC in its recapitalisation. Vijit did not think BBC had a big problem at the time. The problem, he argued, had more to do with Thai politics. If there were confidence in political stability, the financial markets would soon nurse BBC back to its normal health.

That was Vijit's view of the BBC affair.

The Banharn Silapa-Archa government was having a tough time managing the economic downturn. The Thai bubble economy was losing its steam, and asset quality of the banks was fast deteriorating. Indeed, the Thai crisis actually started in 1996 with an infection, which then burst in July 1997.

In the end, BBC could not survive. The Democrats exposed the BBC scandal in Parliament, telling the whole world that politicians had been dining at a BBC buffet.

The central bank ended up losing Bt120 billion in the bail-out for BBC, whose non-performing loans stood at almost 100 per cent.

The episode dealt a serious blow to the BOT's credibility. If BBC was in this big a mess, how about other banks and finance companies?

Prime minister Banharn wanted to remove Vijit, and it fell to finance minister Bodi Chunnananda to do the dirty work. He instructed Vijit to lodge criminal charges against BBC president Krirk-kiat Jalichandra and his accomplice, Indian-born financier Rakesh Saxena, for causing such huge damage to the bank.

Both Krirk-kiat and Saxena were responsible from shifting the bank from routine banking operations to high finance, stock-market speculation and takeover deals. Several dozen dummy companies had been involved, with bank deposits shuffled around in deals involving both local and international banks.

oliticians belonging to the Chart Thai Party had benefited from the sweetheart deals with BBC, and Saxena was furious that Chart Thai had betrayed him.

Bodi threatened to fire Vijit if he failed to bring the case to court, so Vijit scrambled to put the case together. He filed charges against Krirk-kiat and Saxena with the police, but they did not carry much weight, because they were put together in too much of a hurry.

Saxena had the last laugh, as he had already left Thailand quietly, leaving Krirk-kiat holding the bag.

Still, Vijit was unable to keep his job. He did not stay in office long enough to witness the baht attack in November and December 1996.

Rerngchai Marakanond succeeded Vijit as governor and promised to launch a full in-house inquiry into the BOT's inept handling of the BBC scandal. Nevertheless, he hinted the inquiry would not begin until after the central bank had concluded talks with the Industrial Finance Corp of Thailand over the prospects of assuming management of the failed bank. That deal would never happen.

Rerngchai was aware if he did not attend to this scandal that had done so much damage to the BOT's reputation, someone else would. The opposition, led by the Democrat Party, had threatened to launch a House inquiry.

How was a bail-out of BBC with Bt90 billion in public funds allowed to proceed with such poorly outlined details?

Rerngchai had been frozen out by his predecessor, Vijit, confined for six years to running the obscure note-printing house. He was not even the first choice for the governorship when Vijit was sacked in July 1996.

Immediately upon assuming office, Rerngchai faced a series of crises, from an economic crash-landing, a financial meltdown and a currency war to the BBC scandal. Yet, as governor he had to act to restore the integrity of the BOT, which had previously been held as one of Thailand's finest institutions.

The central bank was a gathering of top-notched technocrats. Of its 5,185 employees, 180 work in the Supervision and Development of Financial Institutions Department, 40 in Legal Affairs, 285 in the Commercial Bank Examination Department and 200 in Finance Company Examination Department.

A source familiar with the BOT vouched for the integrity of both the central bank's examination and the legal officials handling the BBC case.

"The problem was that when their BBC reports were submitted to their superiors, no action was taken," the source said.

Phenwan Thongdithae, the BOT's top examiner and assistant governor, called on Vijit to take action against BBC management. Vijit replied to Phenwan's recommendations by reassigning him to a dead-end post under Chaiyawat Wibulswasdi, another assistant governor.

The reassignment marked the first time in the history of the BOT that a senior assistant governor was placed under another assistant governor.

Honest though he was, deputy governor Jaroong Ngukuan must have been aware of the rot at BBC. He worked closely with Vijit and read every report, yet he could not bring himself to warn the governor of the danger of letting BBC continue to play. Jaroong was simply a passive onlooker as the BBC collapsed at his feet.

BOT reports made public in May 1996 by Suthep Thaugsuban, at the time a Democrat MP from Surat Thani, indicated central-bank officials must have detected wrongdoing inside BBC as early as 1992, when its bad loans soared to Bt11.11 billion.

Despite warnings from the central bank, the management, led by Krirk-kiat, continued to flout banking regulations by lending money to cronies and other high-risk borrowers.

By the end of 1995, BBC's bad debts had skyrocketed to almost Bt80 billion.

Instead of taking drastic action against BBC's management, Vijit sought to bail out the bank with money from the Fund for Rehabilitation and Development of the Financial Institutes and the Government Savings Bank (GSB).

The GSB, under the chairmanship of Nibhat Bhukkanasut, approved a deal to buy a 3.125-per-cent stake in BBC for more than Bt400 million. This ill-advised investment ended up with a huge loss.

At that point, about Bt60 billion had been injected into the bank - but Bt30 billion more was needed just to keep it on its feet.

Asked by finance minister Surakiart Sathirathai for details of the BBC affair, due to its political implications, Vijit duly submitted confidential reports.

A letter written by Surachai Phruekbamrung, the BOT's director for supervision and examination of commercial banks, summarised alleged defrauding of the bank by Krirk-kiat, Saxena and Ekachai Athikomnantha. The letter, dated January 23, 1996, was submitted to Jaroong.

Yet it was not until that June that Vijit was forced to file charges against BBC executives for violating banking law. Actually, Vijit had no intention of bringing Krirk-kiat and his cohorts to justice in the first place, which explains the delay.

When the case was forwarded to the Economic Crime Investigation Division, it was handled in an extremely sloppy manner. Neither BOT officials nor the police knew for sure the exact date the one-year statute of limitations in the case would expire, from either not talking to each other or simply not wanting to follow up on the case.

When Rerngchai learned the attorney-general had decided to drop the case against the three suspects in the BBC scandal, he was shocked. By this time, BBC had become a full-blown political scandal, which gave interior minister Snoh Thienthong and his Rambo-style deputy, Chalerm Yoobamrung, the ammunition they needed to settle old scores with attorney-general Khanit na Nakhon.

Only after Khanit put up a strong fight by arguing the statutory period should have started with the BOT's January 23 letter - not February 12, when the BOT informed the BBC executives they were under investigation - did he escape Snoh and Chalerm's vendetta. By this time, prime minister Chavalit Yongchaiyudh and finance minister Amnuay Viravan, who had formed a new government in late 1996, had no choice but to look into the matter - as much as they preferred to distance themselves from this hot potato.

A special panel headed by Ackaratorn Chularat, secretary-general of the Office of the Council of State, was quickly formed to determine the flaws in the legal process that had resulted in failure to bring the notorious case to trial.

It was clear the central bank, after failing to supervise BBC adequately, could not afford to let a "technical mistake" further tarnish its reputation. Hence, Rerngchai's promise to launch an internal inquiry into the BOT's handling of the BBC scandal that would prove, not surprisingly, to go nowhere.

-- The Nation 2009/10/31

[Rumfoord]

The group of 16 thing is interesting. They first came to light when annmouncing corruption in Chuan One Democrat government, and this really briought them to light and political influence. Then of course the Democrats had the next laugh with the BBC case. Now the Democrats are linked to several of the group although not all. Interesting how politcal enemies become politcial allies at least to some degree. PTP believe this will all strengthen the Dem hand in the coalition.

in case you don't know: Newin served the 2nd Chuan Leekpai lead government as coalition partner and was the deputy agriculture minister.

can't wait for the moment when the first dem's apologisers & blame everything on Thaksin brainiacs will come up with their trojan horse theory.

[TAWP]

Execute the lot of them.

[brahmburgers]

Ah but them were heady times. I long to have them back! Khun Kriang at SCB, Julaporn at SCIB, my THB visa card from TFB - what a party those years were! BBC? That bank was only for the silly deals!

Silly is not an adjective that comes readily to mind. How about 'insider' deals. It sounds like a whole lot of VIPs scooped up a whole lot of easy money - with no intention of paying it back. Where did the billions come from, depositors?

RETURN OF SAXENA

The road to scandal

By The Nation

Published on October 31, 2009

(text above)

The Nation article doesn't say who put it together, but it's an incredible story, with twists and turns that almost defy belief. However, being somewhat acquainted with how things happen in Thailand (been a resident for a fifth of my life), it's plausible.

Perhaps it's a stretch, but part of the blame could be placed on the Thai educational system which is rote learning, low standard, allows cheating on exams, and won't allow any inferior student to fail, particularly if that student is from an influential family. If you sow inferior seed, you're going to get inferior crop.

Another factor, in why the mess grew exponentially, is the fact that Thais are often slow to act on important matters. Those of us who read the news, or who try dealing with Thai bureaucracy experience it often.

At least there's some payback, in the form of Saxena being brought back after running away for 13 years. Yet there's an ingrained Thai trait that hates to tangibly bust any VIP or anyone from a prestigious family, even if that person has been running for the law (Chalerm's son comes to mind). We'll see. The next few months should be interesting. Expect a lot of appeals, and Saxena playing the "I'm too sick to be prosecuted" card. Probably similar to the trials at the Hague against former Yugoslav heavies.

Edited October 31, 2009 by brahmburgers

[Rumfoord]

However, being somewhat acquainted with how things happen in Thailand (been a resident for a fifth of my life), it's plausible.

Perhaps it's a stretch, but part of the blame could be placed on the Thai educational system which is rote learning, low standard, allows cheating on exams, and won't allow any inferior student to fail, particularly if that student is from an influential family. If you sow inferior seed, you're going to get inferior crop.

Another factor, in why the mess grew exponentially, is the fact that Thais are often slow to act on important matters. Those of us who read the news, or who try dealing with Thai bureaucracy experience it often.

you should share your view and opinions much more face to face with thais in RL instead of just bitching in an internetforum about anything that is somehow not done in the way you would do it as a white man of superior quality.

[brahmburgers]

However, being somewhat acquainted with how things happen in Thailand (been a resident for a fifth of my life), it's plausible.

Perhaps it's a stretch, but part of the blame could be placed on the Thai educational system which is rote learning, low standard, allows cheating on exams, and won't allow any inferior student to fail, particularly if that student is from an influential family. If you sow inferior seed, you're going to get inferior crop.

Another factor, in why the mess grew exponentially, is the fact that Thais are often slow to act on important matters. Those of us who read the news, or who try dealing with Thai bureaucracy experience it often.

you should share your view and opinions much more face to face with Thais in RL instead of just bitching in an internetforum about anything that is somehow not done in the way you would do it as a white man of superior quality.

Do you know what I do in RL? I interact with Thais every day. A person doesn't have to have pale skin ('white man' as you put it) to be honest and responsible. Neither does a person have to have pale skin and hairy arms to make the effort to put trash in a trash receptacle while attending an outdoor event. Same goes for pets. If I had a pet (which I don't) I would take responsibility for it, and try as best as possible to keep my pet from annoying neighbors. Similarly, if I sired a child with a woman, I would take responsibility for that child, whether I was shacked up with the child's mother or not. Shall I go on with my less-than-veiled allusions to 'superiority' as you put it?

If a member of the Thai royal family mentions things like corruption within Thailand, do you call that 'bitching' also? What one man calls 'bitching,' might appear to another man as pointing things out - which may lead to improvements.

Edited October 31, 2009 by brahmburgers

[brahmburgers]

In the big picture of the Saxena thing, there was harm done. 'What harm?' you may ask.

The harm was primarily to the people who lost money, most likely depositors within the banks which were using their money to give out easy loans for gargantuan amounts to big shots.

There was also harm done to those who suffered when the baht severely lost value in a short time - plus other effects.

[webfact]

Saxena's bail plea rejected, in court custody

By THE NATION ON SUNDAY

Published on November 1, 2009

Following an essentially sleepless night upon arrival in Thailand and a long, restless day yesterday, former Bangkok Bank of Commerce executive Rakesh Saxena was remanded to court custody after his request for temporary release on bail was rejected.

Arriving around midnight on Friday amidst extensive media attention and protection by police commandos, Saxena faced an interrogation that went on until dawn, following a two-hour medical check-up at the Police General Hospital, where he managed to sleep for three hours.

Saxena's request for immediate hospital treatment was turned down after police doctors checked his condition and said he would in any case be under hospital care at Bangkok Remand Prison.

He was taken to the prison at 4pm to begin an initial 12-day detention.

Placed in a communal cell, he did not touch the prison meal but drank water and ate some fruit. He did not speak to his cellmates, including some English speakers who had been reassigned to his cell to help with translation.

Saxena wore the same blue suit he had had on since his flight landed, and remained in a wheelchair as he was taken from the airport to Police General Hospital. He was then taken to CSD headquarters, followed by the courthouse and the remand prison.

He was later assigned to the prison hospital for close monitoring by doctors. He has been given a prison handbook and all his meals are being inspected.

Corrections Department director-general Chartchai Sutthiklom said a special room had been arranged to accommodate visits by Saxena's relatives and lawyers, but this was not a special privilege for the financier. "It is a measure concerning safety and general accommodation to prevent possible criticism from other countries about the mistreatment of inmates in Thai prisons," he said.

Prison commander Sophon Thitithammaphruek said it was possible Saxena would not be taken to the courthouse for a preliminary hearing on Monday, as he could respond to the indictment via videoconferencing.

-- The Nation 2009/11/01

[hammered]

The group of 16 thing is interesting. They first came to light when annmouncing corruption in Chuan One Democrat government, and this really briought them to light and political influence. Then of course the Democrats had the next laugh with the BBC case. Now the Democrats are linked to several of the group although not all. Interesting how politcal enemies become politcial allies at least to some degree. PTP believe this will all strengthen the Dem hand in the coalition.

in case you don't know: Newin served the 2nd Chuan Leekpai lead government as coalition partner and was the deputy agriculture minister.

can't wait for the moment when the first dem's apologisers & blame everything on Thaksin brainiacs will come up with their trojan horse theory.

This has nothing to do with Thaksin. It also has little to do with the Democrats apart form by later association with the politicans in coaltion government. It has little to do with TRT/PPP/PTP apart from by later association with politicians joining the party. It could have plenty to do with a group of polticians spread across the parties and also out of politics. It is quite likely that what happens with the polticians will depend on what evidence comes out or what Saxena says.

All in all this case has little connection with the current politcal power struggle except in terms of being potentially destabilising to the coalition if further charges are brought against others. The G16 dudes have been on both sides of the current divide at various times but the BBC case predates this and goes back to the Banharn government iirc.

[tig28]

Execute the lot of them.

Thanks TAWP... you have made my day !!! Whilst I somewhat agree with the sentiment you express -- I lack your boldness !!!

brahmburgers

Perhaps it's a stretch, but part of the blame could be placed on the Thai educational system which is rote learning, low standard, allows cheating on exams, and won't allow any inferior student to fail, particularly if that student is from an influential family. If you sow inferior seed, you're going to get inferior crop.

Yes sir .... quite a stretch. If you care to look at the interestingly similarly named BCCI ( Bank of Credit and Commerce International) which seared like a comet across the banking world (not just Thailand) around the same time you shall see that gross ineptitude and stupidity of banking regulators..... is most certainly not confined to just Thailand.

The superbly educated masters of the financial universe (in the various Central Banks of the U.S. and G.B. plus many more) were definitely not educated in Thailand --- but they managed to totally ignore the almost unbelievable financial destruction being perpetrated by a bank that was by then well known in international banking circles as The Bank of Crooks & criminals International.

It is not reasonable to single out any particular characteristic of the Thais for the mess that was the BBC collapse ... nor blame any of it on the Thai education system.

If you would like some reading which seems like Science Fiction .... but is not...

http://www.apfn.org/apfn/bcci.htm

Guaranteed to make you feel a lot better about the BBC fiasco.

10 Saudi billionaire Adnan Khashoggi, Bt3.30 billion

During the 1980's Khashoggi, an arms dealer from Saudi Arabia , was regarded as the worlds richest man. His story also reads like Sci Fi. I wonder how he found these geniuses at BBC ??

Much more importantly --- why was I not told of them?

[animatic]

Khashoggi was a real paice of work.

One of the great wheeler dealers of our lifetime... but in his case it isn't such a good thing,

and as with Saxena, his compatriots in business, typically, are not known for their probity...

[webfact]

PM: It's tough to punish all involved in BBC case

BANGKOK, Nov 1 (TNA) – Security for returned accused financial crimes fugitive Rakesh Saxena has been stepped up by Thai authorities while Prime Minister Abhisit Vejjajiva admitted the difficulty of finding the guilty parties involved in the alleged embezzlement which led to the collapse of the Bangkok Bank of Commerce (BBC) in1995.

Prime Minister Abhisit Vejjajiva said in his Sunday broadcast that the difficulty of finding the guilty parties involved in the alleged embezzlement which led to the collapse of the Bangkok Bank of Commerce (BBC) in1995 made it less likely that all those who were involved would be prosecuted.

The official investigation and judicial action in the case have continued to the present in the case, Mr. Abhisit said, adding that investigation of the damages inflicted on BBC must begin with the judicial system.

"It must be admitted," he said, "that it is difficult to punish those involved because it happened a long time ago. The authorities will have to perform their duties in accordance with the law".

Asked whether the difficulty in finding those who were involved was due to the number of politicians involved in the scandal, Mr. Abhisit said elected members of his Democrat Party who have evidence dealing with the case are willing to provide information to the authorities if requested in order to speed up the investigation.

Meanwhile, Corrections Department chief Chartchai Sutthiklom said he ordered officials at Bangkok Remand Prison to closely watch Mr. Rakesh by closed-circuit television to ensure his safety, especially from his own stress.

He said it is unnecessary for police investigators to bring Mr. Rakesh when they submit their investigations to the prosecutor Monday unless the court issues a special order.

The Southern Bangkok Criminal Court on Saturday allowed police to detain the prisoner for another 12 days while police question more witnesses in the case.

Meanwhile, Director-General Tarit Pengdit of the Department of Special Investigation (DSI), said he believed it would have little impact legally if politicians were implicated in court by the accused Mr. Saxena unless there is solid evidence or are witnesses to back up his statement.

The BBC scandal will be handled by the police and not the DSI because the case took place before DSI was established, said Mr. Tarit. The agency could step in if there is new evidence about the case, but it is up to DSI as to whether it would accept new evidence or not.

Fugitive Indian-born ex-financier Rakesh Saxena, extradited from Canada, arrived in Bangkok late Friday and now faces charges for his alleged embezzlement. He gave scant information to police after his arrival, saying that he would rather speak in court.

In 1995, Mr Saxena, then treasury adviser of the BBC, allegedly colluded with Krirkkiat Jalichandra, then bank president, and was involved in setting up dummy loans and fabricating accounts to siphon millions from the bank, causing its collapse under US$3 billion in debts, along with nearly 60 financial institutions, leading directly to the 1997 financial crisis. (TNA)

-- TNA 2009/11/01

[geriatrickid]

(Note to Mod: There are a few threads on this already going, but this one seems to focus on the legal aspects, so I'll post some interesting legal items in this one.)

The charges being brought were the ones used to convince the Canadian Supreme Court to extradite. I didn't realize that the Canadian court system wouldn't extradite previously because of 2 reasons;

1. Under the Canadian Charter of Rights and Freedoms, Saxena could not be be extradited to a country under military dictatorship. The return to "civilian" government in Thailand, especially with Mr. Abhisit,changed that dynamic.

2. The extradition treaty between Thailand and Canada was nullified when Thailand allied itself with Japan during World War II. A new treaty was never formalized.

Thailand used the money laundering and international crime aspect to justify the extradition. The current charge(s) had to pass the international "stink" test, i.e. show merit. The refusal of the Supreme Court of Canada to consider the case suggests that the court saw the charges as reasonable and that the accused's intent to avoid the charges, including a non delaration of such activities when entering Canada were grounds to bar the accused. I think this fellow may wish to consider a plea bargain of some sort. The Thai courts are often accused of being subject to poliitical interference, but it would appear here that the evidence is quite strong.

As a side note, the accused is reported to have lost a case in British Columbia small claims court because he did not pay a home care service C$17,000. The plaintiff is reported to be asking that the accused's property in BC be subject to a lien.

And one last piece of trivia. The cost of the extradition process for the Canadian taxpayer in 2007 was reported to be $10million. It has since been extimated to have now cost close to $15million. Add in the cost to the Thai justice ministry and I'm sure the cost will be double. The point being, there is a lot of pressure on the prosecutors to make the charges stick. There is also a lot at stake politically, including the reputation of the Thai financial system. By that I mean whether or not the regulations are there. There are people that do similar things elsewhere in the world, but eventually they get caught. Thailand will need to get a conviction here so that it can say it's system is regulated. (Not arguing whether the regulations work or not, since one could say they didn't work in the USA or EU either with the current mess.) It's all about being able to say there are functiong effective regulations in place so that international investors have a way to justify investment. No publicly traded company's board will approve investments in a "rogue" investment environment, otherwise it leaves them open to litigation.) That is why this case is so important. Lose the case and it means the regulations are not there and makes it harder to convince foreign, i.e. western/Japanese/Korean capital markets to invest.

[animatic]

Though this does not have direct connections with TRT at the time,

and since the Dems were instrumental bringing the major league funny business to light,

they fact that several players were hot and heavy with coalition partners in both parties

past governments, and PTP and Dem coliations to this day.

There is a relatively small gene pool and as allegiance's shift periodically, in the Thai way

of getting things done, it has re-salted many of those same players and their acolytes

around the current scene liberally.

There are chips yet to fall, but none are firmly in any one camp at this point.

But that is part and parcel of the general depravity, or conversly practiality,

of the Thai political class.

One must note during Thaksin's watch, being a partner with Chart Thai,

there wasn't much pushing hard for extradition, it went on via functionaries,

but like a sleeping soi-dog, it sleeps in the public street, smells bad

and could give you a nasty rash if hands on. So it was hands off in general.

This period goes squarely in the middle of this whole story.

And logically can't be ignored as not being involved as some might wish to do.

And a number of prominent PTP names in todays news, are not put in a good,

nor competent light by this story in any way.

[slimdog]

I think this fellow may wish to consider a plea bargain of some sort.

From a strictly legal perspective, Thailands Criminal Procedure law does really allow for many forms of plea bargaining. Turning States evidence for example is illegal in Thailand

There is also a lot at stake politically, including the reputation of the Thai financial system. By that I mean whether or not the regulations are there.

I am not quite sure about this.

Remember that any charges against Saxena are for crimes committed under the 1995-1996 laws and regulations. Provided that the Bank of Thailand, Finance Ministry, Stock exchange of Thailand or Anti Money laundering Organisation can show that rules and regulations put in place since 1995-1996 would not allow for a similar case to be committed then I think that the reputation of the Thai Financial system shouldn't be too seriously affected regardless of verdict. IMHO..

[jayjayjayjay]

Execute the lot of them.

Why not, Pol Pot did it!

[Arkady]

Newin was deputy finance minister at one point during that period. Perhaps that was when he managed to get his loan from BBC.

The BoT's structure was reformed somewhat after this episode and the failed defence of the baht. Vijit inherited a very hierarchical structure put in place by the first governor, Puey Ungkaporn, in the late 40s that reflected the fact that they initially had very few staff who had any training overseas. Therefore most big decisions were left to the top tier, who had the training and experience, and particularly the governor himself with little input from the lower levels. There was little in the way of committees and regular meetings to allow the working level staff to make their views known higher up. They could only submit reports and it was left to the sole discretion of their seniors what, if any action, would be taken. The accolades received by the central bank on how well the economy seemed to be going in the late 80s and early 90s allowed the BoT mandarins to resist any change and keep the ossified structure in place. A lot the real work there is done by women who, until Tarisa became governor were expected to be uncomplaining workhorses respecting the glass ceiling system.

Vijit and Jaroong had received worrying reports about BBC for some time but Jaroong allowed Vijit to ignore them because he knew that Kirkkiat, a former BoT young high flyer, was Vijit's blue eyed boy. In addition the press reports of what BBC was up made it pretty clear that they were getting into very murky deals overseas. Meanwhile they were unable to make any headway in legitimate business in Thaland where there was huge opportunities to do deals at the time.

Here was a case where the BoT's financial supervision dept, even with its limited capabilities, put its finger on the rot that stank so badly that even they couldn't have missed it but they were ignored as a result of personal favoritism. In the case of Finance One they gave it a clean bill of health, after a detailed audit, and promoted it as a model finance company that should be encouraged to acquire smaller banks only 3 or 4 months before it went bust. Not much later the BoT peed away all of the country's international reserves on an unsustainable defence of the baht in which they lied about their forward positions. I think they have improved a lot but are still capable of major policy errors that cost the country dearly, e.g. the capital controls. It is still an elitist system where the privileged have jobs for life and enjoy a lot of prestige without too much work pressure.

[mdechgan]

Which was more damaging to the the economy? The fall of the BBC, fall of finance one, or the BOT's mishandling of the devalued baht?

[george]

Update: Prosecutor order on Saxena case expected Wednesday

BANGKOK: -- Public prosecutors are scheduled Wednesday to finalise the prosecution order on the BBC banking fraud involving Indian embezzlement suspect Rakesh Saxena, chief prosecutor Seksan Bangsomboon said on Tuesday.

The case in question is about Saxena's siphoning Bt1.6 billion from the Bangkok Bank of Commerce via his dummy company City Trading, Seksan said.

"The prosecution will expedite the case on a fast track," he said.

-- The Nation 2009-11-03

[Old Man River]

Which was more damaging to the the economy? The fall of the BBC, fall of finance one, or the BOT's mishandling of the devalued baht?

It is a good question, but the BOT was ultimately responsible for all three. BTW, in 1996, the BOT's head of financial institution's supervision is now the head of the Thai SEC. Go figure.

[webfact]

SAXENA'S TRIAL

Saxena's mother may bolster the defence

By Kesinee Taengkhiew,

Piyanuch Thamnukasetchai

The Nation

Published on November 4, 2009

Saxena's mother may bolster the defence

The mother of former Bangkok Bank of Commerce (BBC) executive and embezzlement suspect Rakesh Saxena, who is herself a lawyer, may travel from Canada to help with her son's defence during his coming trial, lawyer Khamnuan Chalopatham said yesterday.

"Amrit Sarup may travel from Canada to give advice to him during the trial. It remains to be seen in the next few days whether she will come," said Khamnuan, who represented Saxena in the long-running extradition case between the Thai and Canadian authorities.

He said Saxena had not contacted him since his arrival in Thailand last Friday.

Khamnuan said Saxena had not explicitly implicated any politician as being involved in the BBC scandal when he represented him during the extradition process.

Chief police investigator Pol Maj-General Panya Mamen yesterday said he had submitted additional investigation reports regarding Foreign Ministry interpreters' roles in his interrogation to public prosecutors.

Saxena may not be brought to the South Bangkok Criminal Court for the hearing on a second round of detention, because it could be held via videoconferencing, Corrections Department director-general Chartchai Sutthiklom said yesterday.

"If he really needs to show up at the courthouse, extra protection will be provided by Department of Special Investigation agents, special warden units and special-operations policemen, in addition to normal protection by prison guards," he said.

He said Saxena was under the close care of doctors and other medical staff and that his prison meals were regularly inspected.

Saxena's wife and other relatives reportedly left food and clothing for him after visiting hours on Monday, in order to avoid media attention.

Meanwhile, the team of public prosecutors working on the indictment against Saxena will decide this morning whether to indict him today or next Tuesday, Seksan Bangsombun, director-general of the Attorney-General's Office's Department of Economic Crime Litigation, said yesterday.

The decision will not be influenced by a court decision scheduled for Tuesday in a case in which Krirk-kiat Jalichandra, for whom Saxena worked as an adviser at BBC, has already been indicted by a lower court.

-- The Nation 2009/11/04

[jif]

Saxena pleads innocent in BBC embezzlement case

BANGKOK, Nov 24 (TNA) – Former Bangkok Bank of Commerce (BBC) adviser Rakesh Saxena plead innocent in his testimony to the court Tuesday morning in response to being accused of conspiring with accomplices to approve an improper Bt1.6 billion loan to City Trading Corp in 1995.

Indian-born Saxena was charged with violating the Securities and Exchange Act after allegedly colluding with former BBC president Krirkkiat Jalichandra to approve improper loans to City Trading Corp, owned by Mr Saxena himself.

Thailand's statute of limitations on charges under the law will run out in July 2010.

He controlled the City Trading Corp and was a treasury adviser of BBC at the same time. The duo are charged with committing the offence between February 10 and July 27, 1995.

Mr Saxena was also accused of being involved in setting up dummy loans and fabricating accounts to remove millions of baht from the bank, causing its collapse under US$3 billion in debts, along with 50 other financial institutions, leading to the 1997 financial crisis.

The fugitive Indian-born ex-financier was extradited from Canada and returned to Bangkok to face charges for his alleged embezzlement.

The court earlier handed down a 10-year-imprisonment and a fine of Bt2 billion to Mr Krirkkiat. The appeal court set the hearing date on the case on January 26. (TNA)

http://enews.mcot.net/view.php?id=12944

[RickBradford]

It's not just Thailand.

In almost any country at the lower end of the money scale, the greed brigade is out in full force, led by those with political or similar clout.

When real (i.e. foreign) money is put on the table, their eyes spin round like bubbles in a pisspot and no effort is spared to get their cut.

I won't quickly forget the evening when Vietnam's Minister of Sport was nailed coming out of Hanoi's Metropole Hotel with $100,000 in cash in his underpants....