Everything Over 400,000 Baht Is Suspicious

[samran]

While AMLO is heading this particular initiative, it strikes me that this has the signature of both the BOT and the Revenue Department (MOF), which are two of the more independent government agencies you’ll find in Thailand.

What I think you’ll find is that these initiatives are really meant to act as an incentive to get both buyers and sellers to trade less in the cash economy. The incentive is that electronic transactions are less prone to investigation for fraud, as anti-fraud checks take place when people sign up for either business accounts or bank accounts.

While ostensibly it is to avoid money laundering, it is probably really designed to force people into the ‘formal’ economy so to speak, so that VAT liabilities etc can be more easily calculated and hence collected.

Given that the Thai government doesn’t have the best record in collecting taxes owed to it, this is a move which should be welcomed. It is when non-formal processes are involved that scope for corruption and fraud can most easily occur.

[patsfangr]

It will be interesting to see how this works. When we move to LOS next April, one of the first things we'll do is buy a new car. I'll be paying for it in cash. I expect that it will cost somewhere in the general neighborhood of $1 million baht. (Thinking about a Toyota pickup.)

The money will be funds that I will have deposited into an account in BKK Bank, from retirement and house sale proceeds here in the USA.

My wife is leaving for LOS this weekend on the house hunting trip. I'm transferring funds to her existing BKK Bank account for that purchase. I'm wondering what kind of red tape she'll run into with that much money. I expect that the clear track back to the clean source of the money here will resolve everything. But I'm concerned that the tracking process may hang things up, and make her nervous for a while.

GR

[Pattaya_Fox]

I think that the reason for this is that the Thai government are falling into line with the requests that the major Western governments have made to them to assist in the global fight against terrorists and money laundering from major criminal elements.

Thailand has to be seen to be doing something to assist the global effort and they have come up with this proposal themselves or it has been suggested to then to adopt. These measure will contribute little or nothing towards netting the major criminals and money launderers.

If the government wanted to have a crack down on businesses with regard to whether they are paying the correct taxes or not then they would arrange more revenue investigations and let it be known that a crackdown on tax cheats will result in the tax evaders being severely penalized.

As far as the evolution of electronic banking is concerned it is now getting underway in Thailand and this will evolve and develop further as Thailand itself develops.

So I feel that we are seeing lip service only being paid here with this new anouncement.

[Scott]

I don't think you have to worry about the money transferred through banks. Banks handle that stuff in stride and they just want to be able to make sure it comes from a proper source--house sale, wages, savings etc.. When you buy the pickup, house or whatever--I suggest a cashiers check from the bank--God, try to run around with large sums of cash on you!

As for the law here, I don't understand there thinking. Businesses do business and they are poorly equipped to satisfactorily monitor these kinds of business transactions.

It sounds like they are making a real muddle of this law.

[patsfangr]

I don't think you have to worry about the money transferred through banks.  Banks handle that stuff in stride and they just want to be able to make sure it comes from a proper source--house sale, wages, savings etc..  When you buy the pickup, house or whatever--I suggest a cashiers check from the bank--God, try to run around with large sums of cash on you!

<{POST_SNAPBACK}>

Last thing in the world that I would do is allow my wife to run around with a large sum of cash, Scott - whether in LOS or USA. The money stays in BKK Bank until she finds the house she wants. Then she can retrieve it with a cashiers check. She'll be travelling with a neice and nephew, both 30+ adults; but it still pays to be careful about cash. The relatives have lived in and around BKK all their lives, so they know better than to take such foolish risks.

GR

[kidtongue]

yet, like FinCen in the US. Guess that means everyone is limited to 2 spousal visas at a time...oh well, it's 1 way to implement family planning

[duncanm]

That grandmother prepared to spend 400K cash on a diamond ring for her

grandson's fiancee sounds very suspicious!! 

<{POST_SNAPBACK}>

sounds about right for a dowry payment if she's from a reasonable family?

[Chua]

Jeez, there goes the real estate business....

Maybe if the freakin' Thai banks could handle a company account transfer of funds to another branch of the same bank business folks wouldn't need to walk around with 500K Baht in their pocket!

Thai banks, especially Bank Ayudhya & SCB (Siam Comm) are the worst, most backward, unfriendly, inconsiderate, statist, miserable companies in all of Thailand, and without question the worst banks in the WORLD. They are so arrogant and stupid and incompetent its no wonder the country has such a slow growing GNP -- they have no idea how to treat customers or help business grow -- so its no wonder people would rather carry and use cash...

And now the government think that's a sign of criminal activity? Give me a break -- apparently now it is automatically supicuous not to want to have to deal with such lame institutions like these banks? NO ITS JUST PLAIN GOOD COMMON BUSINESS SENSE.

[roamer]

Jeez, there goes the real estate business....

Maybe if the freakin' Thai  banks could handle a company account transfer of funds to another branch of the same bank business folks wouldn't need to walk around with 500K Baht in their pocket!

Thai banks, especially Bank Ayudhya & SCB (Siam Comm) are the worst, most backward, unfriendly, inconsiderate, statist, miserable companies in all of Thailand, and without question the worst banks in the WORLD.  They are so arrogant and stupid and incompetent its no wonder the country has such a slow growing GNP -- they have no idea how to treat customers or help business grow -- so its no wonder people would rather carry and use cash...

And now the government think that's a sign of criminal activity?  Give me a break --  apparently now it is automatically supicuous not to want to have to deal with such lame institutions like these banks?  NO ITS JUST PLAIN GOOD COMMON BUSINESS SENSE.

<{POST_SNAPBACK}>

Travel a bit...broaden your horizons. Banks in India and quite a few other places make Thai banks look super efficient. And speaking for UK Banks I always find that the only area they are truly efficient in is charging you vast amounts if your account strays out of being massively in their favour for a few minutes...

[frankthetank]

How to circumvent this law:

Step 1, turn on your brain, now you have already a 95% chance of getting around this law, because you have done something that the person who suggested this law didn't do.

Step 2, If you are a jeweler, and someone wishes to purchase 1 million baht necklace, but doesn't want it reported

You sell them the necklace for 399,999, then 3 other 100 baht necklaces for 300K each.

<{POST_SNAPBACK}>

I would want to be that jeweller!!

Turn a 1,000,300 Baht sale into a 1,299,99 Baht sale.

Not too sure if the customer would be too happy though!!

[vasan_blr]

This won't work at all, because no one gives bill for your Jewelry purchase first. Even if they check transactions in Jewelry shops, drug dealers are smart enough to purchase two 200,000 purchase in different shops. Probably they should check the cash transactions in the banks. In general Thai government is failed to have a successful intelligence agency or police informers here. Other wise they would have been successful in cracking down terrorists in the South too.

[vasan_blr]

A 72-year-old woman, who was shopping for an engagement ring for her son’s sweetheart, said she would hate it if the authorities investigated her just because she bought a diamond ring.

<{POST_SNAPBACK}>

72 woman ?

Her son must too old for the sweetheart. This is definitely a suspicious case.

[Sphere]

This is very similar to the brainwave when they asked taxi drivers to report suspicious looking passengers.

[Ferret_IntheSky]

how can I safely transfer my 400'000 I need to show them?

[the_webninja]

This is common in Many Countries, Thailand has just now gotten around to adopting it. I think that more importantly they are trying to get a hold of the idiots who are doing the Bombings. And the easiest way to track them is through the paper trails of the Money. Prior to this Law, the Terrorists were buying Gold and Diamonds because it is easily transferable in all countries back into Money. Therefore making it hard for the Law Enforcement and Anti-Terrorist people to track them. They are passing Laws like this to help try to Tighten the Grip on these Terrorist organizations. I would much rather they do things like this than just look the other way and let Thai people become casualties in some idiots Bombing Raids. Even ONE Thai or Forgiener Dying from these Idiots is too many.

And I for One would do everything I can to help them find these A-holes. If that means a little longer wait or fill out one more piece of paper. I am MORE than willing to go along with it.

[lukamar]

Thai banks, especially Bank Ayudhya & SCB (Siam Comm) are the worst, most backward, unfriendly, inconsiderate, statist, miserable companies in all of Thailand, and without question the worst banks in the WORLD.  

Ain't that the truth.. We setup online banking at Ayudhya before we came back to Canada. When it didn't work from here we called our branch and my wife explained in Thai that it would not work from Canada. They told us to come into the branch, it's a dual signature account, and they would try and fix the problem when we arrived. That's a Total grasp of the situation on their part... Fortunately there is not much money in the account and was just setup because the branch was close to our residence.

SCB, now that's a different story, they don't have a clue. Our house in Phayao has a mortgage from them, what a mistake that was. They don't need accountants because you have to find their mistakes yourself. I have their phone number etched on my monitor in felt pen because we call so often. We wire a half year worth of payments at a time and 50% of the time they say they did not get it. We have to have our bank in Canada trace the funds and 100% of the time they have got it but lost it in the branch somewhere. They have refused to fax us a statement or send it in the mail because of the cost involved, but they will spend 2 hours on the phone (if we call them at our cost) and give us a line by line breakdown. We've continually told them to take the money our of our account for the fax but no way they will do that. Total incompetents. We now have them give a copy of the statement to my wife's father who then marches down to the fax place and sends it to us. What a system.

Edited July 30, 2005 by lukamar

[samran]

Jeez, there goes the real estate business....

Maybe if the freakin' Thai  banks could handle a company account transfer of funds to another branch of the same bank business folks wouldn't need to walk around with 500K Baht in their pocket!

Thai banks, especially Bank Ayudhya & SCB (Siam Comm) are the worst, most backward, unfriendly, inconsiderate, statist, miserable companies in all of Thailand, and without question the worst banks in the WORLD.  They are so arrogant and stupid and incompetent its no wonder the country has such a slow growing GNP -- they have no idea how to treat customers or help business grow -- so its no wonder people would rather carry and use cash...

And now the government think that's a sign of criminal activity?  Give me a break --  apparently now it is automatically supicuous not to want to have to deal with such lame institutions like these banks?  NO ITS JUST PLAIN GOOD COMMON BUSINESS SENSE.

<{POST_SNAPBACK}>

A question on this.

Are you saying that Thai banks don't have online payment systems so a company (for instance) can pay its suppliers? This seems very strange. I mean from an ATM I am able to transfer 20,000 baht from one account to another account for 10 baht. Are you saying a similar payments system such as BACS (in the UK) or BPay (in OZ and NZ) doesn't exist in LOS?

[Heng]

We aren't set up online, but I haven't had any problems with Siam Commercial Bank or Bank of Ayudhya. Never a satang lost or even delayed in thousands of wire transfers both incoming and outbound. They both show up at the land office on time when needed.

If we're talking old school and slightly under par service (in my opinion anyway): Siam City Bank, Government Savings Bank (Omsin), BankThai, UOB (great in Singapore, so-so here), and Bank of Asia.

[deepdiver]

now that will slow dow my wife shopping !

[tracer]

Yeah right.  You'd have to get people to stop using cash receipts for their own tax avoidance procedures first before you'll get anyone to report others.   

<{POST_SNAPBACK}>

Well in Phuket and a prime example is in Karon, where they rent out 100's of shophouses for 5000 baht a month and 10000 baht keymoney per month...

Friend of mine rents a small restaurant in Patong where they use the same trick...

Poor renters obviously cannot deduct the real costs from income so likely cheat back as hard as they can(g)

[Maestro]

Banks in U.S. only have to report any CASH transaction $10,000 and over, not checks

That's corect.

And now listen to this true story, based on an article published last year in a reputable Swiss publication and confirmed by the Swiss bank involved in the transaction. The following is a summary (the original article was in German and is appended for anyone who can read that language).

End September 2004. Mr. Hartwig Thomas, Swiss national, resident in Zurich, Switzerland, goes to the travel agency Cuba Real Tours AG in Zurich and books a trip to Cuba for himself and his lady friend.

The travel agency asks Mr. Thomas to pay the amount of USD 1,528 to the agency’s dollar account at the Swiss bank UBS in Zurich (the agency probably collected dollars, not Swiss francs, because it has to pay the Cuban hotels, etc. also in dollars and did not want to incur the exchange rate risk). Mr. Thomas instructs his Swiss bank, Postfinance in Lucerne, Switzerland, to make this transfer and his account is debited for the corresponding amount in Swiss francs, i.e. CHF 1,962.72. In other words, USD 1,528 are transferred from one Swiss bank account to another Swiss bank account.

After his return from Cuba, Mr. Thomas finds in his mail a letter from his bank saying that his transfer of USD 1,528 was confiscated by the U.S. government. All remittances in foreign currency must necessarily pass through the country of that currency, and the U.S. filters transactions for suspicious accounts, in this case for accounts with the word “Cuba” in its name. Efforts by the Swiss bank to retrieve the money from the U.S. government prove futile.

USD_remittance.pdf