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Thai Coup Leaders Promise Corruption Investigation

Thai Coup Leaders Promise Corruption Investigation


by Richard S. Ehrlich

BANGKOK, Thailand -- The military coup leaders promised to investigate alleged corruption committed during ousted prime minister Thaksin Shinawatra's reign, including his family's 1.9 billion U.S. dollar telecommunications sale, Thailand's purchase of American bomb-detection scanners, and other big ticket items.

Many Thais hailed the Sept. 19 coup as a bloodless way to decapitate Mr. Thaksin's re-elected monopolistic government.

"What happened was a coup de grace, and not a coup d'etat," retired Gen. Surayud Chulanont told reporters, apparently trying to invoke an altruistic image of shooting or stabbing someone to death, to end their suffering, instead of the widespread impression that the military destroyed Thailand's democracy.

Mr. Thaksin however, alive and well and living in London, has become Thailand's Frankenstein.

Created by winning three elections, he is now so scary to the junta's martial law regime that his face is censored on TV with a lame "solar outage" screen, even when he appeared on CNN on Thursday (Sept. 28) during a story about Bangkok's new Suvarnabhumi International Airport, which opened on Thursday (Sept. 28).

The brief "solar outage" ended when video of Mr. Thaksin finished.

After governing for five and a half years, billionaire Mr. Thaksin holds considerable assets in Thailand, Britain, and elsewhere.

His enemies demand the coup leaders freeze his assets, to stop cash being transferred out of this Southeast Asian nation.

But in 1991, the military also staged a bloodless coup, claiming corruption as the major reason for toppling an elected government.

Those coup leaders immediately froze and seized assets of politicians, and others, perceived as "unusually rich."

Years later, after meandering through the courts, those cases fell apart because the coup was illegal.

The current self-appointed six-man junta, hoping to avoid that trap, cancelled the 1997 constitution, and started drafting a new one to legalize their coup.

The sexiest corruption allegations involve Mr. Thaksin's family, which sold its stake in their self-made Shin Corp. telecommunications empire to the Singapore government's Temasek Holdings, for 1.9 billion U.S. dollars in January, without paying capital gains tax.

Mr. Thaksin was never arrested or charged for any crime.

The junta has not demanded his extradition from England.

He defended the telecom deal by saying it was offshore in the Virgin Islands, and included complicated documentation consistent with deals done by other Thai tycoons.

Another murky deal involved InVision Technologies, incorporated in Delaware and headquartered in Newark, California.

General Electric Co. bought InVision Technologies in December 2005, and named the unit GE InVision, Inc.

In 2005, Thailand asked the U.S. to reveal if any Thai officials, or private middlemen, received payoffs when Bangkok signed a deal to buy 26 of InVision's CTX-9000 DSi scanners to detect explosives in luggage for the new international airport.

Mr. Thaksin denied his officials took bribes in the X-ray scanner purchase.

But Thais discovered InVision's deals in Thailand, China and the Philippines included "criminal liability associated with potential violations of the Foreign Corrupt Practices Act (FCPA)" during 2003 and 2004, and InVision was fined 800,000 U.S. dollars, according to a Dec. 6, 2005 announcement by the U.S. Justice Department's Fraud Section.

The Securities and Exchange Commission fined InVision an additional 1.1 million U.S. dollars "for violations" of the FCPA in February.

"The [Thai] distributor indicated that it had offered to make gifts, or payments, to officials with influence over the airport corporation" in Bangkok, the S.E.C. said on Feb. 14 in an Accounting and Auditing Enforcement document.

"Despite this awareness, InVision authorized the distributor to continue to pursue the transaction," the S.E.C. said.

That deal was later halted, but "by proceeding with the transactions, InVision made, or authorized the making of, illegal payments to foreign officials," the S.E.C. said without publicly naming recipients.

Patriot Business Consultants Co. Ltd., the Thai distributor at the center of the sale, denied to reporters any involvement in bribery.

But the S.E.C. said, "InVision improperly accounted for certain payments to its agents and distributors in its books and records, in violation of the FCPA."

After restructuring the deal, CTX scanners were installed in Bangkok's new airport.

The coup leaders have empowered a well-respected, no-nonsense auditor-general, Jaruvan Mainthaka, to investigate the Shin Corp. sale, the CTX scanners, and other alleged corruption.

Mrs. Jaruvan was to be helped by a new National Counter-Corruption Commission (NCCC), also set up by the military junta, which has already started investigating a 620 million U.S. dollar, wastewater treatment project.

"We would like to wrap up the long-delayed [wastewater] case as soon as possible, because it is close to expiry," said NCCC secretary-general, Saravut Maenasavate, referring to a statute of limitations.

The case includes an allegedly inflated government budget to appropriate land zoned to build the Klong Dan wastewater treatment project on Bangkok's outskirts, and allegedly forged real estate documents.

Three politicians and 20 government officials were reportedly implicated, along with the Ministry of Natural Resources and Environment, and also the Pollution Control Department.

The coup's leader, Army Commander-in-Chief Gen. Sonthi Boonyaratkalin, also set up an eight-member special investigative committee, plus a new Anti-Money Laundering office.

"It cannot be emphasized enough that any move to restore democracy in this country without first thoroughly cleaning up its corruption-prone political culture will be doomed to fail," said an editorial in the Nation newspaper.

According to Thai media, the top government projects approved by Mr. Thaksin's administration, and already being probed by the auditor-general for alleged corruption, include:

-- The Agriculture Ministry's 400,000 U.S. dollar project to buy rubber seedlings, bidding among Thai companies for the contract, payments for the young trees, and money pocketed by the companies and farmers.

-- The catering of 180,000 meals per month for airlines in a 270,000 U.S. dollar project linking a Bangkok company and Xian airport in central China.

-- Suspicious warehouse projects, ground services and maintenance facilities at Bangkok's new international airport.

-- The fairness of bids for the government's 810,000 U.S. dollar satellite uplink equipment.

-- Refinanced loans by the Finance Ministry.

-- The allegedly cheap sales price of land used as collateral for non-performing loans, linked to Mr. Thaksin's political party members.

-- A 6.75 million U.S. dollar, government food laboratory, for meat and food businesses, involving the Finance Ministry and others.

The twisted list -- of just the biggest cases -- goes on and on.

More than 10,000 lesser cases of alleged corruption also await.

*************

Copyright by Richard S. Ehrlich, who has reported news from Asia for the past 28 years, and is co-author of the non-fiction book of investigative journalism, "HELLO MY BIG BIG HONEY!" Love Letters to Bangkok Bar Girls and Their Revealing Interviews. His web page is http://www.geocities.com/asia_correspondent

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