February 26, 2010 / 8:30 AM / 10 years ago

UPDATE 2-Thai judges say Thaksin abused power for gain

* Thaksin policies benefited family’s businesses, judge says

* Neither violence nor resolution expected afterwards (Adds details)

By Martin Petty

BANGKOK, Feb 26 (Reuters) - Judges reading a lengthy verdict on whether to seize $2.3 billion of ex-premier Thaksin Shinawatra family’s assets said on Friday his policies benefited his family business, raising the likelihood his money will be confiscated.

Authorities say major violence is unlikely but have mobilised thousands of police and troops to pre-empt any backlash by supporters of the 60-year-old fugitive at the centre of a 5-year political crisis in Southeast Asia’s second-biggest economy.

Analysts expect the nine-judge Supreme Court to either seize all of the frozen wealth or to allow Thaksin to keep a portion of the assets. The latter scenario is seen as more favourable for markets in the short-run as it lessens the risk of an imminent showdown in Thailand’s divisive colour-coded crisis.

“The partial seizure of the assets should be what financial markets prefer because both sides can claim victory,” said Prapas Tonpibulsak, chief investment officer at Ayudhya Fund Management.

(For possible market reactions click on [ID:nSGE61I05K])

Prosecutors say Thaksin and his former wife, Potjaman na Pombejra, concealed ownership of shares in his family business Shin Corp SHIN.BK while in office from 2001 to 2006, and that he abused power by tailoring policies to benefit the company.

Thaksin, ousted in a 2006 coup and convicted in absentia of graft, has denied the charges from self-imposed exile in Dubai.

One judge said a Thaksin-era government policy to convert part of a telecommunications concessions fee into an excise tax “favoured Shin Corp at the expense of the state”.

A judge also said Thaksin concealed his ownership of stock in Shin Corp, an argument seen as a main precondition for deciding there was a conflict of interest in government policies benefiting Shin Corp, a major telecommunications business.

“The way it’s going, it looks highly likely he will have the whole lot confiscated and he’ll not get anything back,” said Jade Donavanik, dean of the faculty of law at Siam University.

“The judge has repeatedly said the stock was Thaksin’s property. Him concealing assets is the entire foundation of this case, so it’s likely they’ll take it all.”

A final ruling on whether to confiscate any or all of the assets was due later on Friday. Thailand’s stock market reopens on Tuesday after a long weekend holiday.

Some analysts say a court verdict unfavourable to Thaksin, could add weight to allegations he is the victim of a political vendetta and may spark an angry response from supporters.


Security was tight around Bangkok’s Supreme Court on what has become known as “Judgment Day”, with cellphone signals jammed to prevent remote-detonated bombings and judges ferried to the courthouse, some from safe houses, in bullet-proof cars.

Six-hundred police guarded the court. Security agencies said thousands of riot troops were on standby in case of unrest.

Political uncertainty has subdued Thailand's benchmark index .SETI in recent weeks, with many traders waiting to see what the ruling will bring. But foreign investors were net buyers for four straight days this week, drawn to bargains in Thailand where stocks are trading at just 10.6 times forecast 2011 earnings, Asia's cheapest after Pakistan, Thomson Reuters data shows.

The pro-Thaksin “red shirt” movement, which last April forced a regional summit to be abandoned and staged demonstrations that sparked Thailand’s worst street violence in 17 years, plans a mass rally in Bangkok on March 14 but says it will not protest on Friday whatever the verdict. [ID:nSGE61N09L]

The delay was widely seen as a move to distance the movement from any groups that might seek to stir up trouble. A splinter pro-Thaksin group, “Red Siam”, rallied close to the court on Friday, but has vowed to remain peaceful.

The “red shirts” accuse authorities of playing up the risk of unrest. Security agencies have said they are most concerned outside agitators, or a “third hand”, will trigger violence.

The twice-elected Thaksin says he will fight any seizure of the assets from exile.

(For a related analysis click on [ID:nSGE61I095]; and for a factbox on the case click [ID:nSGE61M019])

Although the verdict will turn a new page in an intractable political crisis that has alarmed many investors, few believe it will provide any hope of a long-term resolution. (Additional reporting by Ambika Ahuja; Editing by Jason Szep)

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