BURNING ISSUE

Officials closely following the shin corp paper trail

Bank forced to disclose deals by Thaksin's kids, Ample Rich

The Assets Examination Committee (AEC) has beefed up its probe into the Shin Corp deal by ordering Siam Commercial Bank to submit documents related to all the payments made by Temasek Holdings of Singapore to the Shinawatra-Damapong families.

According to yesterday's Matichon newspaper, Viroj Laohaphand, the chairman of a working committee of the AEC, last week sent a letter to SCB asking for details of the financial transactions of the Shin Corp deal.

The AEC is now trying to trace the money through transactions related to Ample Rich Investment Ltd, set up by Thaksin Shinawatra in the British Virgins Islands before he entered politics.

Ample Rich Investment holds the key to the Shin Corp deal. It held 329.2 million shares (about 10 per cent) of Shin Corp before it sold the stocks to Panthongtae Shinawatra and Pinthongta Shinawatra, two of Thaksin's children, at Bt1 apiece on January 20, 2006. On the next stock market trading day on January 23, Panthongtae and Pinthongta sold the shares to Temasek Holdings of Singapore for Bt49.25 for a total of Bt16 billion.

The total Shin Corp deal was worth Bt73.3 billion, involving as it did two other sellers - Bhanapot Damapong and Yingluck Shinawatra.

There are some legal questions that the AEC would like to pursue in this deal. First, were there any actual transactions in the first place between Ample Rich and Panthongtae and Pinthongta, who were supposed to pay the firm Bt329.2 million for acquiring the Shin Corp stocks at Bt1 each?

Sirote Sawasdipanich, the director-general of the Revenue Department, has suggested that the authorities have not found any evidence about the financial transactions between Panthongtae and Pinthongta on the one side and Ample Rich on the other.

If this were to be the case, then it would mean that Ample Rich sold the 329.2 million stocks directly to Temasek.

The AEC would now like to know whether Temasek paid the money into the accounts of Panthongtae and Pinthongta or into the account of Ample Rich. Or maybe the accounts were in the names of other people.

MR Pridiyathorn Devakula, when Bank of Thailand governor, had indicated that the Shinawatra-Damapong families held the money earned from the sale of Shin Corp in local banks without moving the money out. Any unusual movements of this amount would have alerted the attention of the banking authorities.

Another riddle over Ample Rich is whether Panthongtae and Pinthongta actually own the company as claimed. Thaksin set up Ample Rich with a capital of only US$1. Later on he transferred 32.92 million shares of Shin Corp (before the par value of the stocks was split to bring the total amount to 329.2 million shares) to Ample Rich.

Thaksin sold Ample Rich to his children for US$1 - his original cost - without taking into account Ample Rich's assets. At the time, Ample Rich's assets also included its holding of 32.92 million shares of Shin Corp. The value of Ample Rich's assets therefore should have been Bt4.9 billion.

Panthongtae and Pinthongta, as claimed by Thaksin's lawyers, were shareholders and directors of Ample Rich. A day before the deal with Temasek, Ample Rich sold the Shin Corp stocks to Panthongtae and Pinthongta at Bt1 a share, much below the market value in order to avoid having to pay tax.

The next trading day, Panthongtae and Pinthongta sold all the stocks to Temasek for Bt49.25 a share without paying tax because the transactions were made on the stock exchange.

The sale of Shin Corp triggered the political slide of Thaksin. Now the AEC is attempting to find out whether Thaksin tried to conceal his stock holdings without proper reports and whether the authorities could slap tax on his two children.

The Nation