Financial crimes are a national scourge

Thailand is unfamiliar with crackdowns on insider trading. In fact, financial crimes are not commonly heard of here, and major cases dating back two decades can be counted on one hand. This has arguably made perpetrators love this country, so an ongoing investigation into a high-profile case a good sign, something that should be welcomed.
As with all criminal cases, all the suspects presently in the headlines must be deemed innocent until proved guilty by a court. But this doesn’t mean the current case, which involves one of the country’s largest companies, must fade with time, allowing political or financial influences to assert their power. Instead, the hand of the law must deal with this case swiftly to provide justice to all, whether the victims are business executives or small-time shareholders.
Thailand has learned the hard way how alleged insider trading can wreak havoc beyond the business realm. In the early 2000s, one Thaksin Shinawatra narrowly escaped a guilty verdict although it had been established that a massive number of shares of his Shin Corp empire were given to a number of servants. It was claimed that their murky stock ownership was part of a share manipulation scheme. While such a charge has never been settled in court, everybody knows the consequences of letting an alleged business crime of that magnitude hang in the air. The pro-Thaksin camp decried it as a “conspiracy” and its opponents labelled it “exploitation” on a grand scale. The rest is history.
The use of “business nominees” is common in Thailand. The phenomenon is caused by many things, but it certainly has something to do with insider trading. The laws restrict or scrutinise vast movements of shares related to company owners, so the unscrupulous ones have found it convenient to have people who they trust act on their behalf. However, insider trading can also happen in other forms, even seemingly legitimate ones.
Insider trading can make share prices plummet or skyrocket to the benefit or the future benefit of those who commit the crime. When stock prices go down because of insider trading, it’s extremely unfair to small-time investors. When the prices go up, it’s also an injustice, as those involved in insider trading are the first to reap undue profits. Small-time investors might stand to profit if share prices go up, but that doesn’t make insider trading less of a crime as someone somewhere will always end up as a victim.
It’s obvious why insider trading is a rich man’s crime. Small-time investors certainly have no access to crucial information such as whether or when a business will shut down or undergo a massive re-capitalisation. Insider trading normally involves that sort of information. This somewhat explains why we have seen so few insider trading legal cases, let alone successful crackdowns. In a country where money can buy people out of legal trouble, those who commit insider trading can be forgiven for thinking they are immune from prosecution.
The authorities must see to it that this current case goes all the way, in a swift and transparent manner. A fair handling of the case would do a lot for Thailand’s image, politically and economically. But more importantly, how the case ends will set the standard for all.
Embattled Thailand requires a true statement that it has legal fairness for all, no matter how much money is involved. Without such a statement, all the problems related to “injustice” are not likely to go away.