|Financial karma for Thailand's Thaksin
By Shawn W Crispin
BANGKOK - What one hand of the Thai state gave in privileged telecommunications
concessions, the other has taken away on charges of policy corruption and the
accumulation of unusual wealth. In a highly anticipated Supreme Court verdict
on Friday, a nine-judge panel ruled to seize US$1.4 billion (46.4
billion baht) worth of former prime minister and telecom concessionaire Thaksin
Shinawatra's and his family's assets.
The court found that Thaksin and his ex-wife Pojaman na Pombejra concealed
their assets in violation of laws that bar politicians and their spouses from
owning shares in private companies while in office. Judges also ruled that
Thaksin abused his power as premier by implementing policies that directly
benefited his private companies, including the now Singapore-owned Shin Corp,
Advanced Info Services and Thaicom, then known as Shin Satellite.
Thaksin's defense had maintained that the charges were politicized, coming in
the aftermath of the 2006 military coup that toppled his government, and he
challenged the legitimacy of the military-appointed Asset Examination Committee
that originally built the case against him. His lawyers also argued that there
were no legal grounds to seize all of Thaksin's and his family's assets because
much of the funds were earned before he took public office in February 2001.
A potential $2.3 billion (76.6 billion baht) worth of frozen assets were in
question in the trial. It was not immediately clear from the decision if the
Finance Ministry's revenue department would be empowered by the verdict to
seize another 36 billion baht it has ordered frozen from Thaksin's two
children, Panthongtae and Pinthongta. The ministry has claimed the two owe at
least 12 billion baht in back taxes from the 2006 sale of Shin Corp to
The landmark ruling represents the biggest state seizure of a deposed Asian
leader's assets since the 1986 fall of the notoriously corrupt dictator
Ferdinand Marcos in the Philippines. The more complicated case against Thaksin
represents the second corruption conviction against him since his government
was toppled in 2006. He fled into exile in August 2008 just days before being
sentenced to two years in prison for his role in an irregular Bangkok land deal
involving his government and ex-wife.
The court-ordered seizure of Thaksin's assets is in line with the gathering
trend towards the "judicialization" of Thai politics, an apparently royally
endorsed concept where high courts and judges assume the role the monarchy has
traditionally played in mediating the country's complex and often heated
political disputes. Observers noted that King Bhumibol Adulyadej symbolically
addressed groups of judges on two occasions in recent weeks, urging them to
adjudicate with "righteousness" the cases they handle. By Thai law, the
monarchy is above politics.
The widely revered monarch made a similar address in the lead-up to a
Constitutional Tribune decision in May 2007 that resulted in the legal
dissolution of Thaksin's former ruling Thai Rak Thai party and banned 111 of
the its top executives - including Thaksin - from politics for five years.
After a period of ill-health that has confined Bhumibol to hospital since last
September 19, the 82-year-old monarch has resumed certain ceremonial roles in
the weeks leading up to Friday's decision.
While conservative interests have looked towards the courts to play a larger
role in checking and balancing politicians and officials ahead of the eventual
royal succession, Thaksin's red shirt-wearing United Front for Democracy
Against Dictatorship (UDD) protest group supporters have challenged the
impartiality of recent verdicts that they perceive have disproportionately gone
against them, including the court-ordered dissolution of two Thaksin-aligned,
democratically elected political parties since 2007.
It is not immediately clear whether the landmark verdict will lead to more or
less political instability. Acting government spokesman Panitan Watanayagorn
predicted in an interview before the verdict that the country's political
situation would improve after the ruling. He noted that Prime Minister Abhisit
Vejjajiva planned to focus less on domestic politics and more on neglected
foreign policy, including planned trips to Australia, India and Russia, after
On the other side of the political divide, the ruling will likely fuel the
Thaksin-aligned UDD's rally call against what it has claimed are double
standards in Thai society. UDD protest leaders retreated from earlier plans to
stage mass rallies meant to pressure the government ahead of the ruling, but
have now vowed to bring one million Thaksin supporters from the provinces to
Bangkok in mid-March to topple Abhisit's government and force new elections.
Some analysts wonder whether the seizure of Thaksin's substantial assets will
impact on the UDD's future ability to orchestrate and finance future large
scale protests. Thaksin has consistently denied that he bankrolls the UDD, but
the group's leaders and supporters clearly march to his orders, including his
call from exile last April for his supporters to rise up in a “revolution” and
overthrow Abhisit's government.
Because many here believe that future stability is dependent on Thaksin's
access to funds, the level of his off-shore holdings is a matter of wild
speculation in the local media. Thaksin said in a recent interview with the
Times of London that he still has between $100-$200 million in assets
off-shore. Diplomats tracking the situation note that he clearly has enough
funds to make recent investments in lotteries in Fiji and Uganda and gold mines
in Swaziland and Papua New Guinea, among other high risk ventures.
Other political analysts wonder whether the seizure of his billions and
intensified efforts to extradite him from the United Arab Emirates will push
the exiled former premier towards brinksmanship, including a possible expansion
of the conflict from Bangkok into the northeastern rural provinces where his
support is known to run strongest. They point to recent threats made by rogue
retired and current military elements in Thaksin's camp who have called for the
creation of a "people's army" and veiled threats to assassinate judges and
officials involved in the handling of his assets case.
Underlining the emerging fragmentation of Thaksin's camp, the UDD issued a
statement refuting those claims, saying it has "renounced our previous call to
arms" and "categorically denies any involvement" in a recent grenade attack on
army headquarters and a C-4-laden explosive found in front of the Supreme Court
weeks before Friday's verdict. It's unclear which group now has the former
premier's ear, but historically Thaksin has played political factions in his
camp off one another in divide and rule fashion.
The government has pre-emptively responded to the threats by mobilizing joint
civilian and security force teams across 38 provinces, including in Bangkok,
and the erecting of new security cameras in areas of the national capital,
including this week in front of the Supreme Court. To guard against a chaotic
repeat of last April's breakdown in law and order, government spokesman Panitan
said that security forces are prepared to deploy new "layering" techniques to
prevent peaceful protests from spiraling into violent riots.
The seizure of $ 1.4 billion Thaksin's Thailand-based assets will spur new
guessing games about exactly how much he may have socked away off-shore and his
future willingness to funnel those funds into new bouts of instability. One
government insider speculated that Thaksin's declining fortunes were already
evident before Friday's verdict, witnessed in what he viewed as his "third
class" private jet, decidedly "middle class" dwellings in Dubai and wardrobe
shift from Armani to less refined business suits.
Others believe the image-conscious Thaksin has purposefully downgraded his
on-camera presentation to evoke sympathy among his rural supporters and that he
is keeping his financial powder dry to press his case for a royal pardon after
the eventual succession from Bhumibol to his heir apparent son, Crown Prince
Vajiralongkorn. While Thaksin is no doubt financially down with the seizure,
it's not clear yet that he's politically out.
Shawn W Crispin is Asia Times Online's Southeast Asia Editor.
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