According to a case referral from the Stock Exchange of Thailand (SET), it was revealed that TRC executives had known or possessed inside information, as expressed in the auditor’s opinion, about TRC 2018 performance which showed a net loss of 2,040.57 million baht due to the accounting of impairment reserve for investment records and other records in relation to a company in which TRC had invested through its subsidiary company. The SEC’s further investigation found that four persons, namely (1) Pasita, TRC’s executives’ daughter and sister, (2) Rewadee, TRC’s senior accounting manager, (3) Ounruen, TRC’s financial manager, and (4) Ariya, Ounruen’s sister, had knowledge or possession of such inside information and the persons in (1), (2) and (4) had used such information to sell TRC shares in their trading accounts, during 12 December 2018 and 25 February 2019, in a different manner from their normal practice, and had avoided losses from a decline in TRC share prices before its 2018 net loss operating results were disclosed to the public (via SET) on 26 February 2019 at 8.49 hrs.

The action of Pasita, Rewadee and Ariya in this case was deemed a sale of TRC shares while knowing or possessing the company’s inside information, a contravention of Section 242(1) in conjunction with Section 243(2) or Section 244(3)(4), as the case may be, while the action of Ounruen was deemed a disclosure of inside information to Ariya, a contravention of Section 242(2) in conjunction with Section 243(2), subject to the liabilities under Section 296 and 296/2 of the Securities and Exchange Act B.E. 2535 (1992) (SEA), as amended by the SEA No. 5 in 2016.  

The Civil Sanction Committee (CSC) has therefore resolved to impose civil sanctions* on those four offenders, comprising civil penalties, compensations in the amount equal to the benefits received or would have been received, reimbursements of investigative expenses incurred by the SEC, and a bar from serving as director or executive in securities issuing companies or securities companies for specified periods, with the following details: 

(1)  Pasita shall pay a civil penalty, a compensation in the amount equal to the benefits received and a reimbursement of investigative expenses incurred by the SEC, totaling 2,777,611 baht, and shall be barred from serving as a director or executive for a period of 12 months;  

(2)  Rewadee shall pay a civil penalty, a compensation in the amount equal to the benefits received and a reimbursement of investigative expenses incurred by the SEC, totaling 663,307 baht, and shall be barred from serving as a director or executive for a period of 12 months; 

(3)  Ounruen shall pay a civil penalty and a reimbursement of investigative expenses incurred by the SEC, totaling 563,307 baht, and shall be barred from serving as a director or executive for a period of 12 months;

(4)  Ariya shall pay a civil penalty, a compensation in the amount equal to the benefits received and a reimbursement of investigative expenses incurred by the SEC, totaling 632,082 baht, and shall be barred from serving as a director or executive for a period of 12 months; 

The prohibition periods for the offenders serving as directors or executives will commence on the dates when the offenders sign the letters of consent, agreeing to comply with the civil sanctions imposed by the CSC. Otherwise, the SEC will submit the cases to the public prosecutor for filing a lawsuit in the Civil Court to seek an imposition of civil sanctions with the maximum applicable statutory penalties, which shall not be lower than the penalties specified by the CSC.

In all cases, the civil penalties and the compensations for the benefits received or would have been received from committing the offenses shall be remitted to the Ministry of Finance as public revenue.   

Remark: 

* Section 317/1 of the SEA B.E. 2535 (1992) as amended by the SEA (No.5) B.E. 2559 (2016) prescribes that the criminal offenses under this Section shall be deemed the offenses whereby civil sanctions may be imposed on the offenders.

Details of civil sanctions and associated procedures are available at:  https://www.sec.or.th/EN/pages/lawandregulations/civilpenalty.aspx