Bangkok, 5 January 2018 – The SEC has filed a criminal complaint against four former and current executives of K.C. Property Public Company Limited (KC) and three associates with the Department of Special Investigation (DSI) for jointly committing dishonest acts to misappropriate the money received from the sale of KC short-term bills of exchange (B/E) for their own interest or other persons’. The case also involves seeking unlawful gains and consenting to the omission of the B/E transaction records, which caused inaccurate preparation of KC accounting records.
The aforesaid four executives are: (1) Mr. Pattarapob Ittisanyakorn (later renamed Krittiphat), (2) Mr. Sunchai Intarauksorn, (3) Mr. Teerasit Sangngern and (4) Mr. Kitisan Mookdee. The three associates are: (5) Mr. Thepthiwa Bootprom, (6) Miss Jaroonluck Kongkarien (later renamed Nittha), and (7) Mr. Veerawat Sukwara.
Following the auditor’s report and the SEC’s further investigation, it was found that from September 2015 to October 2016, the said executives and their associates had jointly committed fraudulent acts by misappropriating the sale money of 25 issues of KC B/E, at the total value of approximately 425 million baht, for their own or other persons’ interest.
In committing such acts, (1) Pattarapob, then acting managing director and executive director, and (2) Sunchai, then deputy managing director and executive director, jointly made a fraudulent arrangement for KC to offer the 25 B/E issues at a value ranging from 25 to 150 million baht each, and then misappropriated the proceeds by counterfeiting the company’s meeting documents, jointly opening a bank account for receiving the B/E transfer transactions, concealing such B/E sale by omitting the sale transactions from the company’s accounting records, and concealing the fraud by extending the maturity terms of such B/E issues several times.
The fraud was supported and assisted by (5) Thepthiwa, who knew Pattarapob and Sunchai. In so doing, Thepthiwa allowed his own bank account to receive transfers of the total B/E sale money to be further distributed to other persons while (6) Jaroonluck, secretary to the KC Board of Directors, assisted in executing certain financial transactions through her own bank account, and (7) Veerawat, who also knew and persuaded several persons – namely, Pattarapob, Sunchai, Teerasit and Kitisan – to take the positions of director and executive of KC, was believed to have involved in the fraudulent acts and the receipt of a certain amount of B/E sale money.
It was also found that during 2016, (3) Teerasit and (4) Kitisan, KC executive director and managing director, respectively, knew of the B/E issuance but did not perform their duties responsibly and honestly, and failed to have the B/E transactions in the KC accounting records, causing inaccurate and false preparation of such records.
The misconduct of the executives and their associates above is liable to legal offences as follows: The persons in (1) and (2) are liable to failure to perform duties honestly under Section 89/7 and thus subject to the penalties under Paragraph 2 of Section 281/2, Section 307, Section 308, Section 311 and Section 312 of the Securities and Exchange Act B.E. 2535 (1992) (SEA). The persons in (5), (6) and (7) assisted in the commission of the fraud and thus subject to the penalties under Section 307, Section 308, Section 311 and Section 312 in conjunction with Section 315 of the SEA, as the case may be. The persons in (3) and (4) are liable to failure to perform duties honestly under Section 89/7 and thus subject to the penalties under Paragraph 2 of Section 281/2 and Section 312 of the SEA. The SEC has therefore filed the criminal complaint against all seven persons with the DSI for further legal proceedings.
Being named in the criminal complaint has caused KC current and former executives, i.e., (1) Pattarapob, (2) Sunchai, (3) Teerasit, and (4) Kitisan, to be liable to having untrustworthy characteristics of directors and executives of issuing and listed companies pursuant to the SEC Notification*. Consequently, they are prohibited from holding such positions pursuant to the SEA.
In addition, the misconduct in this case may be liable to be a predicate offense under the Money Laundering Control Act. The SEC has therefore forwarded the case to the Anti-money Laundering Office for further consideration regarding relevant matters.
In any case, filing a criminal complaint commences the criminal justice administration whereby the consideration whether a defendant is guilty is under the DSI’s investigation, the public attorney’s prosecution, and the court’s jurisdiction, respectively.
* The Notification of the Securities and Exchange Commission No. KorJor. 3/2560 Re: Determination of Untrustworthy Characteristics of Company Directors and Executives dated 23 January 2017.