Prachai cash claims may hit govt

The ruling Democrat Party seems to be in hot water over controversial donations, allegations involving fund siphoning and linking certain party MPs from the South to it.

At the centre of the controversy are businessman-turned-politician Prachai Leophairatana, formerly a top executive of TPI Polene; and advertising firm Messiah Business and Creation. Prachai insisted that he had never made any donations to the Democrat Party and that the money was in fact meant to cover advertising costs.

Messiah owed the Revenue Department Bt10 million in unpaid taxes on its Bt258 million advertising revenue. Police Maj-General Sawek Pinsinchai, who has close ties with ousted premier Thaksin Shinawatra, later brought the matter to the attention of the Department of Special Investigation (DSI).

The DSI later discovered the money had started flowing out of TPI in 2004 to be spent on campaigning in the 2005 general elections. At that time, Banyat Bantadtan was the Democrat Party leader and Pradit Pataraprasit was the secretary-general. Pradit is now with the coalition Ruam Jai Thai Chart Pattana Party.

TPI executives were accused of directing funds from the registered public company to people close to some Messiah executives and politicians from the Democrat Party.

According to Matichon Online, the Bt258 million was found to have been transferred to the bank accounts of three groups of people - one connected to a senior Messiah executive, and the other two linked to certain Democrat MPs. There were 75 or so money transfers, most of which were in amounts of less than Bt2 million - the legal limit before banks are required by law to report to the Anti-Money Laundering Office.

Messiah had to declare bankruptcy by court order in June last year. With a registered capital of Bt1 million, the company managed to earn more than Bt152 million in 2004, though its annual revenue totalled less than Bt10 million in the four previous years, according to data from the Department of Business Development.

A document produced by the opposition Pheu Thai Party shows that the money, mostly transferred by the same man between December 2004 and February 2005, was put into accounts at 64 bank branches in Bangkok and 11 in Songkhla.

This controversy has seriously dented the Democrat Party's credibility, and even though no concrete evidence has been discovered against the ruling party, it has been damaging politically.

Nipon Bunyamanee, a Democrat party-list MP from the South, insisted yesterday that the ruling party had nothing to do with the controversy. He said it appeared as if the opposition was trying to stitch together unrelated facts in a bid to create bad press for the Democrats.

"It has nothing to do with the Democrat Party. No money from Prachai was transferred to any party MPs," Nipon said.

The politician said the opposition was using the facts that Democrat MP Supatcharee Thammaphet had once been an executive at Messiah, that the party had hired the firm to produce its campaign posters, that TPI had used Messiah in an advertising campaign and that his sister was a distributor of TPI cement in the South.

"If that's all the information the opposition has, I can explain it. It just shows the standard of this opposition," Nipon said.

The MP explained that his sister had launched an advertising campaign worth Bt40 million to Bt50 million in order to boost the sales of TPI cement. He said that last year, he had explained this to the DSI and provided documents to prove his innocence.