The Securities and Exchange Commission (SEC) has ordered the dismissal of Inter Far East Energy's (IFEC's) chief executive on grounds of insider trading and refusal to acknowledge a civil sanction.
Earlier, the market regulator ordered former chief executive Suphanan Rittiphairoj and former director Thanawat Chansuwan to pay civil fines and compensate damages worth a combined 25.86 million baht.
Mr Suphanan, however, sent a letter asking to postpone acknowledgment and agreement to pay a civil fine to Oct 3 on grounds of a busy schedule. But the SEC did not allow the postponement and determined that Mr Suphanan was persistent in refusing to set up an IFEC shareholders' meeting, which damaged both IFEC and its subsidiaries.
The securities watchdog is also suspicious of an IFEC creditor that has filed a business rehabilitation plan with the Central Bankruptcy Court and has asked for Mr Suphanan to be a temporary administrator and planner.
This move could be considered an attempt to delay IFEC business operations to continue being under the management team, instead of setting up a shareholders' meeting to select new directors, the SEC said.
"The SEC has sent a letter to the prosecutor to file a lawsuit against Mr Suphanan in the Civil Court to press for civil sanctions with the highest legal penalty," the regulator said in a release. "[Mr Suphanan] is ordered to pay a civil fine and the benefits of his wrongdoings, which total 31.93 million baht.
The SEC has also reported the proceedings to the Anti-Money Laundering Office for further consideration."
IFEC retail investors, meanwhile, will continue to press charges against former chairman and chief executive Wichai Thavornwattanayong despite Mr Suphanan's dismissal from his position, as Mr Wichai wanted the company to fall into a business rehabilitation plan without any changes made at the management level.
Yaowaluck Ritsomjit, leader of the investor group, said the SEC's latest order is a move that retail investors have been waiting for.
Despite sluggish prosecution and incurred damage among retail investors as a result of conflicts between major shareholders, the regulatory enforcement procedure has taken effect, she said.
"We hope that the process of setting up a shareholders' meeting can happen in the next 1-2 months," Ms Yaowaluck said. "There are two directors in the company's board of directors, and they have a duty to set up the meeting in accordance with Section 83 of the Public Limited Company Act of 1992.
"Our lengthy contention has not been for naught. The market regulator has tried to protect retail investors and enforced the law, which is what we wanted to see earlier. We also hope that IFEC will not fall into a business rehabilitation plan, because only one creditor who has relations with Mr Wichai has filed a business rehabilitation case with the Central Bankruptcy Court.
"Retail investors have to continue the legal battle to protect their rights."
Ms Yaowaluck said a group of shareholders led by Thavich Taychanavakul, managing director of Thai Industrial Estate Corporation Ltd, which holds more than 200 million IFEC shares, has attempted to set up a shareholders' meeting by using Section 100 of the Public Limited Company Act of 1992.
Although their combined shares total 500 million or 25% of IFEC's paid-up capital, this is insufficient to set up a meeting, which requires more than 33% of shares, she said.
"We have to disseminate information through securities firms and the media to inform investors to send their proxies to us," Ms Yaowaluck said.