26-year repayment for Klongchan creditors

26-year repayment for Klongchan creditors

About 100 victims of the Klongchan Credit Union Cooperative embezzlement rally outside the Cooperative Auditing Department in 2015 to demand legal action and repayment. A demonstrator holds a banner reading she is already 86 years old and doubts when she will ever be repaid. (Photo by Pawat Laopaisarntaksin)
About 100 victims of the Klongchan Credit Union Cooperative embezzlement rally outside the Cooperative Auditing Department in 2015 to demand legal action and repayment. A demonstrator holds a banner reading she is already 86 years old and doubts when she will ever be repaid. (Photo by Pawat Laopaisarntaksin)

The Klongchan Credit Union Cooperative will need some 26 years to fully repay its embezzled members, who are a group of its creditors, the Cooperative Promotion Department said on Tuesday.

The timeframe was calculated based on the rehabilitation plan of the cooperative which involves borrowings to set up a fund to be invested for gains so it could repay the money to the members, said Phichest Wiriyaphaha, director-general of the department.

Earlier, Klongchan planned to borrow from the Bank for Agriculture and Agricultural Cooperatives and Government Savings Bank but both state-owned banks turned it down, he said.

The banks claimed if they did so, they would need to set aside 100% loan-loss provisions for the lending as Klongchan was insolvent, he added.

Therefore, Klongchan would borrow from other cooperatives that were already its creditors. If successful, the fund should yield a profit of about 450 million baht a year. It had yet to conclude how much other cooperatives would agree to lend, he said.

Embezzlement caused damage totalling 15 billion baht for the once-richest cooperative. In March last year, a court order was issued for its rehabilitation. So far, 1.2 billion baht had been repaid to its creditors.

Mr Phichest said Klongchan had about 1 billion baht left in its accounts and some assets.

The embezzlement case was linked to fugitive Phra Dhammajayo, former abbot of Wat Phra Dhammakaya.

The 72-year-old monk allegedly received multi-million-baht "donations" from the former management of the cooperative. Its ex-chairman who was already in jail was a former treasurer of the temple.

Security authorities were laying siege at the temple in Pathum Thani province for nearly a month in order to arrest him.

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