The Stock Exchange of Thailand (SET) has proposed a legal reform to the Finance Ministry, advocating for the Securities and Exchange Commission (SEC) to have the authority to directly file lawsuits against perpetrators of corporate fraud. The change aims to accelerate the legal process, allowing high-impact cases to reach court within five to six months.
SET Chairman Kitipong Urapeepatanapong made clear the urgency of this reform following numerous fraud and stock manipulation cases, notably involving Stark Corporation and Energy Absolute. These incidents have inflicted considerable harm on investors and eroded trust in the market. Under the current system governed by the SEC Act, the path from accusation to courtroom is lengthy and bureaucratic, often taking several years as it involves multiple steps and various agencies.
The proposed amendment would streamline this process by enabling the SEC to bypass the police and go directly to prosecutors, a practice aligned with systems in the United States, South Korea, and Japan. The modification is expected to dramatically reduce the timeframe for legal proceedings to between five and six months. The SET is also planning a seminar with South Korean prosecutors to discuss and potentially adopt their expedited investigatory processes.
Additionally, the SET is considering new regulations requiring listed company executives to disclose the use of securities as collateral for loans. The measure is expected to enhance transparency and allow investors to monitor companies’ financial activities more closely. (NNT)
