The Department of Special Investigation (DSI) has resolved to summon Vicharat Vichitvadakan, former secretary-general of the Financial Sector Restructuring Authority (FRA), to hear an accusation

that he assisted Lehman Brothers to evade tax payments in the auction of bankrupt financial institutions after the 1997 economic meltdown.

Sunai Manomai-udom, director general of the DSI, said he planned to ask Amaret Sila-on, the FRA chairman at that time, to submit testimony to make the investigation more complete.

Sunai said at a press conference yesterday, after concluding the final interrogation of witnesses and investigating evidence in the case, that officials had jointly agreed to summon Vicharat on February 22 to hear the charge that accuses him of assisting Lehman Brothers to evade tax payments.

The DSI will also summon representatives of Global Thai Property Fund, managed by Lehman Brothers, and Lehman Brothers itself to hear charges on February 23 and February 26 respectively.

The DSI decision yesterday was the first of a series of investigations into the auction of 56 defunct finance firms by the FRA with total assets valued at Bt600 billion. However, the FRA received only Bt150 billion from the auction.

During Thailand's 1997 economic crisis, several foreign investors, including hedge funds, bought problem assets from local financial institutions at low prices. The US-based financial firms GE, Lehman Brothers and Goldman Sachs acquired assets once held by 56 now defunct finance companies from the FRA.

Sunai said officials are of the opinion that Vicharat intended to help Lehman Brothers by delaying the contract signing by seven days to enable the company to set up a registered mutual fund to evade tax payments.

"This act clearly violated FRA's regulations," Sunai said.

He said if Vicharat can bring evidence to prove his innocence during the hearing, the DSI will not file charges against him.

A source at the Department of Special Investigation said it will forward evidence to the National Counter Corruption Commission to let it determine whether it will file a complaint against the finance minister at that time on behalf of those in charge of the FRA.

The DSI has already interrogated 60 witness in the case, the source said.

FRA auctioned off 53 property projects totalling Bt24.616 billion. Lehman, which was an adviser to FRA, joined the bidding on August 13, 1998, and won bids for projects totalling Bt11.52 billion.

FRA required the transfer of rights within seven days after the auction date on August 20, 1998. However, Vicharat decided to extend the deadline.

On October 1, 1998, Lehman Brothers transferred the rights to Global Thai Property to evade tax. This act caused damage to the country.

Siriporn Chanjindamanee

The Nation