Transcript of the above video: 

As the title of this video suggests, we are discussing issues associated with ongoing investigations into corporate fraud here in Thailand, most notably anti-nominee, I guess initiative that is being sort of rolled out. Thai Law Enforcement is heavily scrutinizing corporate structures in order to ascertain whether or not someone is acting effectively as a nominee in order to basically front for foreigners that are essentially for lack of a better term, behaving badly in Thailand. Now the article I am going to cite here is very good. The analysis in there I think is pretty spot on across the board, but there is a part of it that to my mind I don't know if the author missed it or it just didn't really come to mind, but as the title suggests and we will get to here in a moment, I think further analysis when you do a drill down, one of the real problems in terms of where all these issues regarding nominees and illicit business activities coming from, I think a lot of is coming from the fake foreign lawyers. That's the best way to describe it. That said let's jump in here.

I thought of making this video after reading a recent article from the Bangkok Post, that is bangkokpost.com, the article is titled: Nominee structures thrust into the spotlight. Quoting directly: "Although foreigners are legally limited to owning no more than 49% of shares in a Thai Company, some structures allegedly rely on Thai nominees with little real financial involvement or decision-making power. In many cases, Thai shareholders may be relatives, acquaintances or individuals sourced through legal or accounting firms that assist with company registration." Well again, they say that, but they don't take it the step further where I really see the issue, and it is fake foreign lawyers. As we have discussed in other videos, foreigners are completely restricted from the legal services sector in Thailand, as well as Accounting, Tax Matters - again all professional services - clerical, if you read the restricted occupations, I mean there is Section 27 which pertains to Legal directly and then there is 26 which is clerical which is if anybody tries to play on the margins and say, "well I'm not this, I'm that", it's clear in the restricted occupations. Anybody that's trying to act, that is not a Thai national, that is trying to act in any capacity in the legal services sector is operating illegally. I mean I'll put the link in the description below to the Department of Employment's website, the Restricted Occupations list as promulgated in 2020. It's in English; it can be read. I've read it on this channel before. But the point I'm trying to make is this article goes a good ways in showing what's going on - the news if you will - but it doesn't sort of do the inferences to see where these issues really are stemming from, in my opinion, and this is based on anecdotal evidence I have collected over nearly 20 years, and from personal experience as well. 

That being said, quoting further: "Some arrangements also involve loan agreements requiring Thai shareholders to pledge their shares to foreign Investors, effectively transferring control if conditions are breached." Again, this is a telltale sign of undue foreign influence in the legal services sector because this is a mechanism that is utilized in many other jurisdictions - especially Common Law jurisdictions - in order to gain some result thereby. Thailand has a different set of laws. Thailand isn't a Common Law jurisdiction; it's a Civil Law jurisdiction but it's Thailand's own Civil Law. Thailand has never been colonized. Their own body of law is their own. It is unique. Applying analysis from other jurisdictions and trying to apply it on to Thailand, can land you in real hot water. It's yet another reason why utilizing folks that have no licensure in Thailand and are not Thai nationals, in this jurisdiction can cause more harm than good. Even though it may seem like there is somebody that you can sort of rely upon, at the end of the day it's sort of like the biblical notion of building one's house on sand; it's not a good idea. 

That said, quoting further: "Power-of-attorney documents are another common mechanism, allowing foreigners to exercise full authority over company operations despite legal ownership appearing Thai on paper." Yeah, again this is one of these sort of colour-of-law tricks that we're seeing, again undue outside or undue foreign influence being brought to bear in Thailand in a legal context, again by foreigners who have no business operating here. And again, the “common mechanism” is undue foreign influence, and by that, I mean foreigners who are operating in this space that have no business doing so. Now there may be some that have qualifications in other jurisdictions and to them I would say, "hey look, be careful, this is Thailand, it is not your jurisdiction, it is a different thing. Now there may be circumstances where a foreign professional may be useful for someone as it pertains to that outside body of law, so there is that. 

Then on top of it, we've got the other problem here in Thailand unfortunately, of literal fake lawyers which I've discussed at length in other videos. These folks really more than these legal instruments that they are talking about this article, again the common mechanism are the people who are effectively putting these people up to this kind of stuff. Because you have got basically lay people who are detrimentally relying on people that they believe are qualified to guide them through various processes, and if they're not a Thai national, the restricted occupations is clear. And meanwhile, if they are just a total fraud, they have no qualification whatsoever in any jurisdiction, I mean that's even more problematic.

That being said, quoting further: "Law firms, accounting firms, local brokers and intermediaries may help establish companies, source Thai shareholders or facilitate documentation." Well at the end of the day, that's legal work, but if it's involving foreigners, again who are not Thai and have no qualification as a Thai legal professional, what are we talking about? 

To my mind, the focus is not where it needs to be on this issue with regard to all these problematic setups and these foreign nationals that are ending up in these structures that now are being targeted for real scrutiny and possibly even things like dissolution; we are seeing nearly two dozen people who are in jail down in the islands right now - foreign nationals - on charges related to these nominee type structures. I would love to know how many of those folks detrimentally relied on what they thought was a true legal advisor here in Thailand, but they were actually a foreigner who was basically operating outside of Thai Law; I would be very curious to know that. Because at the end of the day, to my mind that's the common thread here, that's the common mechanism, and as Thais here in Thailand, and we really want to get to the heart of this problem, the heart of this problem comes from those who it's like the scene at the end of the movie The Firm - I may make that the thumbnail for this video - where he says, "basically you need to go after their lawyers" - he's talking to this FBI guy who basically wants to go after these Mobsters, and he says, "no, you need to go after their lawyers; if they're the ones that are causing the problem that's the root cause of the problem". It looks to me like in Thailand it's not lawyers per se, real legal professionals are what they are. Here in Thailand it looks to me like again undue foreign influence by fake foreign lawyers seems to be the crux of the problem that we are now seeing associated with nominees and other criminal activity here in the Kingdom of Thailand.