Thai Police Look into $167 Million Loans Racket by Phairath Khampha 31 May 2002 In another example of the rampant corruption in Thailand and how it leads to the collapse of the country's economy every now and then, Thailand's Crime Suppression Division (CSD) in May 2002 started investigating the embezzlement of about $167 million that somehow involved the the filthy rich and corrupt Asavahame family and partly caused the collapse of Bangkok Metropolitan Bank. A CSD source said the division had received a complaint from Siam Suriyadit, the managing director of Chan Group Co, on May 9. The man said MP Petroleum Co, run by relatives of former deputy interior minister Vattana Asavahame, had forged documents to seek loans worth more than seven billion baht on Chan Group's behalf from the now-defunct Bangkok Metropolitan Bank (BMB) in 1996 and 1998. Police eventually had 22 suspects in the seven-billion-baht embezzlement case. According to the source, Mr Siam claimed that his company, a major petrol distributor in the Northeast, was forced to buy fuel from MP Petroleum Co and enter a joint venture with MP Petroleum to distribute oil in the region. His company had earlier bought petrol from several oil companies, but not MP Petroleum. Influence was applied when Mr Vattana, a sort of underworld godfather-like figure, was a deputy interior minister under the Chuan Leekpai administration and took place when Mr Siam was on an overseas trip. One of the men who allegedly tried to coerce Chan Group in Khon Kaen was identified as Samlee Pokha-in, alias Sua Fai, who was murdered in Bangkok recently. In Thailand it is common to deal with a problem by murdering the source of a problem, as a quick and dirty solution, much to the detriment of many "honest": foreigners. Samlee was a former aide of Mr Vattana. Samlee and his men took documents from Chan Group and the papers were used to back the loan requests. Upon his return to Thailand, Mr Siam contacted BMB to demand return of the Chan Group documents. The bank refused and his company was also forced to transfer the loan money to MP Petroleum. The transfer was disguised as payment for MP Petroleum's fuel. Shortly afterwards, Chan Group was sued in Khon Kaen court as the loans were out of all proportion to the collateral placed. After getting Mr Siam's complaint, CSD commander Pol Maj-Gen Surasit Sangkhapong set up a working group to investigate. It questioned witnesses and gathered documents from Khon Kaen court and the BMB. A CSD investigative team was tracing a man identified only as Goh who joined Samlee in applying pressure on Chan Group Co. Another team took a prime witness to CSD headquarters in Bangkok in the middle of May. The witness was quoted as saying that BMB executives had abused their authority in approving the seven billion-baht ($167 million) loans. The CSD source said the lending was partly responsible for the BMB's collapse, much like the bad loans which brought down the Bangkok Bank of Commerce (BBC) and the Thai economy in July 1997. CSD deputy commander Thawee Sodsong, who received the complaint from Mr Siam, would on May 20 took documents from Chan Group Co concerning the loan requests to the Scientific Crime Detection Division to see if they had been forged. If their examination found the loan papers were fake, the CSD would file charges against executives of MP Petroleum, the source said. The BMB was one of four financially ailing commercial banks taken over by the Bank of Thailand's Financial Institutions Development Fund. The other three were BBC, Siam City Bank (SCIB) and First Bangkok City Bank. BMB was ordered to merge with SCIB on April 1, 2002. MP Petroleum executives could not be reached for comment. Police track fraud suspects Police eventually had 22 suspects in the seven-billion-baht embezzlement case involving the MP Petroleum Co of veteran politician Vattana Asavahame. People from Chan Group and the defunct Bangkok Metropolitan Bank were suspected of involvement in the forgery of documents of Chan Group, distributor of MP Petroleum products in the Northeast, a source in the Crime Suppression Division said. The documents were used to seek 5.13 billion baht in loans from BMB from 1995 to 1999. The CSD had questioned one suspect, a woman, and what she had told the investigators was found to be very useful.