The Securities and Exchange Commission (SEC) has moved to confiscate the assets of Stark Corporation, as well as those of the company's largest shareholder and some former executives allegedly involved in falsifying accounts, in addition to prohibiting them from travelling abroad.
The regulator said it will freeze the assets of the scandal-hit wire and cable manufacturer and those of Vonnarat Tangkaravakoon, the company's largest shareholder and former acting chief executive, for 180 days.
The assets of four former executives, comprising former chairman Chanin Yensudchai, chief financial officer Sathar Chantrasettalead, Chinawat Assavapokee and Kittisak Jitprasertngam, will also be seized, along with those of Stark's related entities Phelps Dodge International (Thailand), Thai Cable International, Adisorn Songkhla Co and Asia Pacific Drilling Engineering.
The SEC recently filed charges of financial misconduct against those 10 parties with the Department of Special Investigation (DSI), alleging they were involved or agreed with others to produce false statements for Stark and its affiliates during 2021 and 2022 to deceive other people.
"Their misconduct has affected a large number of people with damages from Stark's debts estimated at more than 38 billion baht," the SEC said in a statement.
The order to freeze the assets was issued as "there are reasonable circumstances to believe the individuals will transfer or sell those assets", said the regulator.
The SEC will also seek a court injunction to prevent the accused from leaving the country in the next 15 days, noted the statement.
Mr Vonnarat resigned from all his positions at Stark, including acting chief executive and director, the company said in a filing to the Stock Exchange of Thailand on Thursday.
Four others charged by the SEC quit the company in April. Apichart Tangeakchit is acting chief executive until a new chief can be appointed.
Thawatchai Pittayasophon, SEC acting secretary-general, told a briefing on Friday the regulator would continue to investigate other possible irregularities at Stark, cooperating with the DSI in charging those found culpable for fraud.
"The SEC will continue to investigate other suspicious cases related to the company," said Mr Thawatchai.
"The investigation is also looking into possible misconduct by the auditor as well as stock price manipulation. Once we gather enough evidence, more charges will be filed against those involved."
Under the SEC's authority, assets can be confiscated for a maximum of 180 days, while the order to prohibit executives from travelling abroad can be renewed.
During this period, Stark can continue to operate as normal.
"The SEC is confident the evidence we collected and sent to the DSI is sufficient to bring this case to court," he said.
The crackdown on Stark is critical to restoring investor confidence in the local bourse, particularly in medium-sized and small companies, said Chavinda Hanratanakool, chairwoman of the Association of Investment Management Companies.
Companies are facing more difficulties mobilising new funds through the issuance of debt securities, she said.
"Without a speedy restoration of confidence, companies will find it hard to raise funds for debt refinancing and business operations, which could hurt the economy," said Mrs Chavinda.