The Khehasathan Noppakao Ruamjai Cooperative has been ordered closed after 5.5 billion baht was found missing from its accounts, and the directors are facing charges of embezzlement.
It is suspected the missing money may also be linked to academic Sawad Saengbangpla, the former chairman of the Chulalongkorn University cooperative charged over a fraudulent lottery scheme.
Phichet Wiriyapaha, deputy director-general of the Cooperative Promotion Department said on Wednesday the closure order was issued on May 11.
Directors of the Khehasathan Noppakao Ruamjai Cooperative would face embezzlement charges, he said. Officials would try to trace the money and return it to the members.
Mr Pichet told a news conference the cooperative had no money left in its accounts, but still had assets worth about 1 billion baht. Earlier, there had been deposits of 5.51 billion baht.
There were three major depositors: Nonthaburi Teachers' Cooperative with deposits of 113 million baht, the Chulalongkorn University savings cooperative (915 million baht) and the Federation of Thai Finance Cooperatives (4.48 billion baht).
The finance federation had 35 cooperatives as its members, with deposits of 5.75 billion baht.
Mr Phichet also said that the arrested former chairman of the cooperative of Chulalongkorn University, Assoc Prof Sawad Saengbangpla, had been chairman of the federation when it deposited 4.48 billion baht with Khehasathan Noppakao Ruamjai Cooperative.
His department asked the Anti-Money Laundering Office to trace the money of all the cooperatives involved.
Mr Phichet said the management of Khehasathan Noppakao Ruamjai Cooperative had bought land cheaply and later pledged it to borrow huge amounts of money, thanks to suspicious land evaluations by some appraisal firms.
He said the cooperative's remaining land had been appraised at 6.9 billion baht, but his department found the worth to be only 1 billion baht.
The cooperative had no liquidity and posted a loss of more than 300 million baht. Its financial statement had not been reconciled for the past two years. Therefore, its closure was ordered, Mr Phichet said.