FINANCIAL INVESTIGATION AND MEASURES FOR CONFISCATION
AND ASSET RECOVERY IN THAILAND
Athitiya Dairerkngam*

I. INTRODUCTION
Corruption and money-laundering are interrelated since corruption causes massive financial
gain that is necessary to be laundered to make such financial gain appear legitimate. For thisreason, the existence of corruption will lead to money-laundering activities. In order to counter
corruption and money-laundering, it is essential to provide the process of financial investigation,
identification, tracing, freezing and confiscation of such illegal benefits effectively. In Thailand,
the Anti-Money-Laundering Office (AMLO) and the Office of the National Anti-Corruption
Commission (NACC) are the two significant organizations which deal with corruption and antimoney-laundering cases. However, this paper shall focus on merely the National Anti-Corruption
Commission's roles and authorities in preventing and combating corruption. Also, it shalldemonstrate the National Anti-Corruption Commission's legal framework and measures infinancial investigation and confiscation of illicit assets and illustrate a corruption case to show thecollaboration between the NACC, the Attorney-General and the U.S. government.
II. DUTIES AND POWERS OF THE NATIONAL ANTI-CORRUPTION COMMISSION
IN CONDUCTING FINANCIAL INVESTIGATION, FREEZING, CONFISCATION
AND ASSET RECOVERY
Under the Organic Act on Anti-Corruption B.E. 2561 (2018), the NACC has the duties andpower to conduct an inquiry and prepare an opinion when there is an allegation that a person
holding a political position, a judge of the Constitutional Court or a person holding a position in
an independent agency is involved in circumstances of unusual wealth, corruption or deliberateperformance of duties or exercise of powers contrary to the provisions of the Constitution or laws,
or a severe violation of or failure to comply with ethical standards. Moreover, it has the power to
conduct an inquiry and decide whether a public official is unusually wealthy, has committed anoffence of corruption, or malfeasance in public office or malfeasance in judicial office.
Additionally, it has the power to obligate persons holding political positions, judges of theConstitutional Court, persons holding positions in independent agencies and state officials tosubmit accounts showing particulars of their assets and liabilities and those of their, spouses andchildren who have not yet become sui juris, and to inspect and disclose the results of the inspectionof such accounts.1*1

Asset Inspection Officer, Office of the National Anti-Corruption Commission, Thailand.
The Organic Act on Anti-Corruption B.E.2561, section 28.

- 137 -III. THE PROCEEDINGS OF FINANCIAL INVESTIGATION, FREEZING,CONFISCATION AND ASSET RECOVERY IN A CORRUPTION CASE UNDER THE
ORGANIC ACT OF ANTI-CORRUPTION B.E. 2561
The NACC has the power and authority to conduct a financial investigation when it appears tothe NACC, regardless of whether there is an allegation or the NACC has reasonable grounds tosuspect, that any public official is unusually wealthy.2 Under the Organic Act of Anti-Corruption
B.E. 2561, the property of the alleged culprit shall include the property that is under the ownershipof another person and there are circumstances indicating that the property or its ownership is heldby a nominee. In such a case, the person holding title to the property has the right to prove that theproperty is not unusual wealth.
In order to conduct a financial investigation in a corruption case, the NACC sets theproceedings of financial investigation, confiscation and asset recovery by implementing the United
Nations Convention against Corruption (UNCAC) through the Organic Act on Anti-Corruption
B.E. 2561. Accordingly the NACC shall conduct the following.
A. Tracing and Identifying Financial Assets
In order to identify and trace the movement of money during the course of criminal activity,
investigators need to find the link between the origins of the money, the beneficiaries, when andwhere the money was received, transferred and deposited, and where it is stored, since such
movement of money can provide information about and proof of criminal activity.3
For identifying a financial transaction, the NACC shall have the power to inspect the sourcesof the assets and liabilities, financial movement or transactions of such person and perform anyother acts to obtain relevant facts. If the alleged culprit has submitted the account of assets andliabilities, the NACC shall compare the account of assets and liabilities with the existing assets atthe time of inquiry, including the income and expenses and also the income tax of such person.
For this purpose, the NACC shall have the power to order the alleged culprit to submit the accountof assets and liabilities according to the list and time period as prescribed by the NACC regardlessof whether such person has previously submitted the account of assets and liabilities.4 Thus, theNACC has the power to request relevant documents from all institutions directly. Evidence ofcorruption may be found through the account of assets and liabilities of public officials that is
submitted to the NACC.
B. Financial Evidence Analysis
The NACC uses the specific method; this method is used when there is evidence that candirectly trace the flow of money from the corruption activity to the official together with the source
and application of funds method; the method that the investigator will have to determine whether
The definition of unusual wealth under the Organic Act on Anti-Corruption B.E.2561 is having an unusually large
amount of assets, or having an unusual increase in assets, or having an unusual decrease in liabilities, or acquiring
assets without legitimate grounds in consequence of the performance of duty or the exercise of power in office or in
the course of duty, including the case of having an unusual increase in assets upon comparison of the accounts
showing particulars of assets and liabilities.
3
APEC Anticorruption and Transparency Working Group, 'Best Practices In Investigating And Prosecuting
Corruption Using Financial Flow Tracking Techniques And Financial: A Handbook' (2015) 91.
4
The Organic Act on Anti-Corruption B.E.2561, section 116.
2- 138 -public officials are living significantly above their legitimate means.5 Typically, the investigatorneeds to prove that the alleged culprits have underreported income by making a comparison of
total assets owned by the alleged culprits relative to their tax returns. Consequently, if the alleged
culprits have assets more than their taxable income and the legitimate source of funds for thoseassets cannot be explained, the NACC shall consider that circumstances are indicative of unusual
wealth and shall conduct an inquiry for a subsequent request for assets to be confiscated.6C. Asset Freezing
The objective of this method is the preservation of the assets that may later be subject toconfiscation and to prevent their removal. The applicable standard to determine the assets subject
to these measures is the reasonable suspicion or belief that the assets are the proceeds or aninstrumentality of a crime.
Under the Organic Act on Anti-Corruption B.E. 2561, if it appears from the inquiry that thefacts convincingly indicate the possibility of the transfer, move, transformation or concealment ofthe property that the alleged culprit has used in the commission of an offence or is unlawfullyacquired in connection with the commission of the offence that is under the duties and powers ofthe NACC or the property vis-à-vis unusual wealth, the NACC shall issue a freeze order or atemporary seizure in two cases: one is in cases where the commission of the offence has a criminal
penalty and another is in cases of property vis-à-vis unusual wealth. However, in cases of unusual
wealth, the NACC shall have the power to issue a temporary seizure or freeze order which must
be within one year from the date of the seizure or freeze or until the Court passes a final judgment
dismissing the case.7 Nevertheless, if the owner or a person who possesses such property is able
to prove that the property is not unusual wealth, the NACC shall issue an order of release of seizureor freeze without delay.8 Additionally, the NACC also sets the regulations in order to manage theassets that are frozen or are temporarily seized to preserve their safety and value until they are
eventually confiscated or released.9 Such regulations are mainly the proceeds of administration of
the seized assets, the asset manager, expenses, use and sale of restrained assets.
D. Confiscation Proceedings
The NACC uses both a property-based confiscation system10 and a value-based confiscation
system11 as stated in section 83 of the Organic Act on Anti-Corruption B.E. 2561, permitting theNACC or the Attorney General, as the case may be, to file a motion with the Supreme Court’s
Criminal Division for Persons Holding the Political Positions for the confiscation of the following
properties:(1) property which any person used or had in his or her possession for use in thecommission of the offence,
Ibid. n. 4, 111.
The Organic Act on Anti-Corruption B.E.2561, section 113.
7The Organic Act on Anti-Corruption B.E.2561, section 69.
8Ibid. n. 6.
9The Organic Act on Anti-Corruption B.E.2561, section 85.
10This system allows the confiscation of assets found to be the proceeds or instrumentalities of crime. See n. 4, 152.
11This system allows the determination of the value of the benefits derived from crime and the confiscation of anequivalent value of assets that may be untainted. See. n. 4, 152-153.
56- 139 -(2) property or interest that can be calculated into monetary value, which has been given,
requested to give or pledged to give to the alleged culprit by any person in an unlawfulmanner,(3) property or interest that can be calculated into a monetary value which a person has
obtained from the commission of or from his involvement as an instigator, an aider andabettor, or a publisher or announcer in order for another person to commit the offence,(4) property or interest that can be calculated into a monetary value which a person has
obtained from the disposal, distribution or transfer in any manner of the property or interest
under (1) or (3),(5) fruits or any other interest occurring from the property or interest under (1), (3) or (5).12
Under the Organic Act on Anti-Corruption B.E. 2561, the assets which are confiscated shallbecome properties of the state as from the date of the court ruling. However, in case there is arequest for assistance from a foreign country under the law on mutual legal assistance in criminal
matters to proceed against a foreign public official, an official of a public international organizationor any other person on the grounds that an offence was committed under section 140 of the Organic
Act on Anti-Corruption, the management of the confiscated assets shall be in accordance with theagreement made with the requesting country.13
IV. CORRUPTION CASES
Ms. J, the former governor of the Tourism Authority of Thailand (TAT), was charged withdemanding a bribe from Mr. G and his wife, an American couple, in exchange for their being
awarded an over 13 million U.S. dollar contract to organize the annual Bangkok International Film
Festival. Ms. J's daughter helped her mother commit the offences by opening accounts in numerous
foreign banks, and the American couple concealed the bribes in the shell companies, some withfake addresses and phone numbers, and paid the money, 1.8 million U.S. dollars, into bankaccounts in many different jurisdictions in the name of Ms. J’s daughter and a friend of thegovernor.
This case was initiated by the Federal Bureau of Investigation (FBI), and the United States
Attorney for the Central District of California conducted the investigation regarding the bribes
made to influence the awarding of contracts to manage the Bangkok International Film Festival.
Tracing the transactions between the American couple and Ms. J, including her nominees, foundthat some bribes were given in cash and some by transferring to the accounts of Ms. J’s daughterand friend.
Additionally, the evidence presented and witness hearings established that Mr. G and his wife
were granted the sole rights to run the event despite lacking the necessary expertise, experience or
any related proven work record. Besides, there was no other organizer attending the competition
1213

The Organic Act on Anti-Corruption B.E.2561, section 83.
The Organic Act on Anti-Corruption B.E.2561, section 140.

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for the contract, which the court decided was an attempt to inhibit other potential competitors fromtaking part. As a result, the film festival rights were secured by three companies, all of which werecreated by the couple to receive the contract from the TAT on Ms. J's advice.
In 2010, the U.S. Court sentenced the American couple to six months in jail and six months ofhome detention for their part in paying bribes to secure the rights to run the festival. The couple
was found guilty of money-laundering and violating the Foreign Corrupt Practices Act.
On the part of the Thai proceedings, the NACC gathered the evidence from Thailand and othercountries in order to convict Ms. J. The NACC defermined that Ms. J was engaged in corruption
in the course of duty, constituting a criminal offence under the Act Concerning Offences Relating
to the Submission of Bids to Government Agencies B.E. 2542 (1999) and the Act on the Offenceof the Officials in Public Organization, B.E. 2502 (1959). Her daughter was found guilty ofconspiracy to commit corruption. Consequently, the NACC furnished the report and inquiry file,including all related evidence to the Attorney-General to file a case against Ms. J in Court. Inaddition, regarding the unusual wealth offence, the NACC also passed a resolution declaring thatMs. J is unusually wealthy. Now the legal proceedings for the unusual wealth offence are in recess
in order to wait for judgment in the criminal case.
In 2017, the Central Criminal Court for Corruption and Misconduct Cases rendered the verdictthat Ms. J was guilty of receiving bribes from the American business couple. Ms. J was sentenced
on 11 counts of corruption and imprisoned for 50 years, while her daughter was imprisoned for 44years. In addition, the Court also ruled to confiscate all the money plus interest for 1.8 million U.S.
dollars from the overseas bank accounts of the defendants to become property of the state. The
case is now pending in the Supreme Court.
V. CONCLUSION
Thailand has been aware that corruption is one of the most severe threats undermining thecountry in every aspect. Consequently, the NACC, as the organization which has the duties andpowers in dealing with the corruption cases of high-ranking officials, has been trying to find thebest practices in countering corruption, especially enhancement of the effectiveness of theproceeds of freezing, confiscation and asset recovery. Enforcement of confiscation orders in otherjurisdictions is seen as one of the crucial challenges in asset recovery procedure in Thailand. Since
the confiscated property will frequently be located in a foreign jurisdiction, it will be essential torestrain it as soon as possible in order to avoid dissipation. For this reason, quick and effective
freezing and confiscation measures should be applied. Therefore, Thailand should enhancecooperation with other countries by seeking and providing mutual legal assistance agreements inorder to allow direct enforcement of a foreign confiscation order because indirect enforcement cancause dissipation of the asset quickly, making future confiscation difficult, which could lead toinefficiency in preventing and countering corruption.

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