SEC: Legal violation fines totalled over B2bn in 2019

The Securities and Exchange Commission (SEC) disclosed fines for those who violated the Securities and Exchange Act tallied more than 2 billion baht last year.

The fines came from offenders who refused to accept the SEC’s civil sanctions and wanted to defend their cases in court.

Many of the offenders, however, decided to settle the fines before they went to court.

Thawatchai Pittayasophon, assistant secretary-general in charge of the SEC’s legal department, said the latest amendment to the act in 2016 gave the securities watchdog increased civil sanction punishment, making the law enforcement process swifter.

The SEC law enforcement process previously dealt primarily with criminal proceedings that were limited by the need for complete proof of evidence, meaning some cases were determined to be inconclusive.

There were many agencies involved in the criminal proceedings, resulting in a lot of steps taken without the SEC’s oversight.

For serious criminal prosecution, such as fraud or absence of a business licence, the civil sanction is a fine of up to twice the benefit, with the profit to be surrendered.

For cases related to insider trading or falsifying information, the offenders will be barred from being directors or involved in the management structure of listed companies.

The Civil Sanction Committee under the SEC is comprised of the attorneygeneral as committee’s chairman as well as directors.

The directors are the Finance Ministry’s permanent secretary, the Department of Special Investigation’s directorgeneral, the Bank of Thailand governor and the SEC’s secretary-general.

Mr Thawatchai said the SEC is carrying out a study to amend the law enforcement process, increasing efficiency by reducing the investigation process.

“Delayed and repetitive criminal proceedings mean it can take a very long time for each case to completed. The SEC will amend the law to make it more effective in the future,” he said.

In 2019, the SEC initiated 18 criminal cases on 43 offenders in total. For the first half of 2020, there were four cases involving 13 offenders.

For civil cases in 2019, 35 cases were submitted to court, with the court imposing fines on offenders totalling around 2.24 billion baht. Of the total, 725 million baht was related to share manipulation, 94.5 million for insider trading and the rest related to the disclosure of insider information to others.

For the first half 2020, civil fines were valued at 17.5 million baht and the compensation for received benefits tallied 12.9 million.