Following an inspection report from KBANK, a limited broker dealer and underwriter (LBDU) licensee, and the SEC’s further investigation, it was found that some employees of the bank, who acted as securities investment consultants, had committed wrongful acts against clients at various branch offices as follows:     
            (1)  In the case of Miss Surasa Mungthaworn, it was found that she had persuaded clients to invest in funds and withdrew large sums of money from the clients’ accounts. However, she did not make any investment transactions in accordance with the clients’ intention and transferred the clients’ money to the savings accounts opened under the names of other persons instead. She arranged for investment unit purchase transactions of other clients, with the value equivalent to the withdrawn money, to be printed on the fund books of other clients and had the bank’s seal stamped on the fund books or recorded in investment unit purchase transactions on fund books and delivered the same to clients as evidence. In addition, it was found that she deceitfully sold investment units of clients and revolved funds from other clients to return to clients in many other accounts. Such acts were done by falsifying documents relating to the trading of investment units of funds and documents relating to cash withdrawals, with the intention of deceiving clients that the investment units of funds had been traded according to their intention. Miss Surasa Mungthaworn confessed that she had fraudulently taken over 17 million baht from clients to be used for her own interest;
            (2)  In the case of Mr. Pattarawut Thunyajaroen, it was found that he had falsified documents for the redemption of investment units, forged deposit account passbooks by use of the IDs of other bank employees without their knowledge, issued deposit passbooks to receive money from the sale of investment units on clients’ behalf, and had redeemed clients’ investment units in a total of 9 million baht. He arranged for other bank employees to withdraw money from the sale of investment units by use of the user IDs of other bank employees in approving transactions, and deposited an amount of 8.75 million baht in a nominee account. In addition, he deceitfully withdrew money from the deposit accounts of six clients and confessed to the bank that he had destroyed documents evidencing these transactions. The acts of Mr. Pattarawut Thunyajaroen, therefore, constitutes an offense by planning a series of complicated actions with a view to unduly gaining clients’ assets;  

            (3)  In the case of {C} , who at the time of committing the offense, was the branch manager of the branch where Mr. Pattarawut Thunyajaroen was working. {C} affixed her signature on a cash withdrawal transaction of 9 million baht of a client of Mr. Pattarawut Thunyajaroen with a view of selling investment units and failed to check whether there was any withdrawal request slip. In addition, she failed to follow up on the source of this cash withdrawal transaction. As a result, Mr. Pattarawut Thunyajaroen was able to complete the fraudulent acts. The act of {C} constitutes a failure to reasonably check and monitor in order to oversee a juristic person or business over which one has the management power or operates under one’s supervision.

The acts of the three persons stated above constitutes a failure to perform duties with responsibility and prudence as a professional under the relevant Notification of the Capital Market Supervisory Board.*  The SEC has therefore imposed the following sentences:  
            (1)  In the case of Miss Surasa Mungthaworn, the SEC revoked the approval as investment consultant and will not accept her future application for approval as personnel in the capital market business for a period of 10 years, effective from 9 November 2018;
            (2)  In the case of Mr. Pattarawut Thunyajaroen, the SEC revoked the approval as investment consultant and will not accept his future application for approval as personnel in the capital market business for a period of 10 years. However, his approval expired on 31 December 2017. The SEC therefore specified the period of 10 years, effective from 9 November 2018;
            (3)  In the case of {C}, she is prohibited from functioning as a branch manager responsible for capital market business, and the SEC also imposed a suspension on the approval of {C} as a securities investment consultant for a period of two months, effective from 14 November 2018.

Investors are strongly advised that if wishing to trade investment units via banks, they should personally enter into these transactions themselves and refrain from leaving important documents, namely withdrawal slips, investment unit purchase or sale orders, deposit passbooks, and fund books with bank employees. In addition, investors are encouraged to verify to ensure that they receive all documents evidencing trading that are issued by banks or asset management companies. For example, investors must receive copies of the investment unit purchases or sale orders with transaction details entered, and the amounts from the operating system of the fund or banks or asset management companies must be confirmed for transactions via SMS or email from banks or asset management companies. Investors are advised to update their fund books (if any) on a regular basis in order to prevent any damage from frauds.

Accordingly, the bank has terminated the employment of these investment consultants without making any severance payment, initiated legal actions, and compensated every client.

In furtherance of this case, the bank is undergoing an improvement of its operating system in order to prevent any frauds that may arise from reprinting investment unit trading transactions in another client’s account. In this regard, the SEC has emphasized that the bank should expedite the improvement of the operating system in order to mitigate any risk in this manner for its clients.

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* With respect to the first case, Clause 31(1) and Clause 33(3) of the Notification No. Tor Lor Thor. 8/2557, as amended, and Clause 35(1) of the Notification No. Tor Lor Thor. 8/2557, the SEC has revoked the approval as an investment consultant and fixed a period for consideration of application for approval for acting as personnel in the capital market business.
- With respect to the second case, Clause 31(1) and Clause 33(3) of the Notification No. Tor Lor Thor. 8/2557, as amended, and Clause 35(1) of the Notification No. Tor Lor Thor. 8/2557, the SEC has fixed a period for consideration of application for approval for acting as personnel in the capital market business.  
- With respect to the third case, considering that {C} has the prohibited characteristic under Clause 31(2) of the Notification No. Tor Lor Thor. 8/2557, as amended, she is, therefore, prohibited from performing duties as a branch manager with respect to the capital market business under Clause 31(2) of the Notification No. Tor Lor Thor. 8/2557, as amended, and Clause 34(3) of the Notification No. Tor Lor Thor. 8/2557. By virtue of Clause 34(3) of the Notification No. Tor Lor Thor. 8/2557, the SEC hereby informed the bank to prohibit {C} from performing the duties as a branch manager with respect to the capital market business. In addition, as {C} is prohibited from performing these duties, she cannot perform duties as other personnel in the capital market approved by the SEC under Clause 30(4)(a) of the Notification No. Tor Lor Thor. 8/2557, as amended. By virtue of Clause 33(2) of the Notification No. Tor Lor Thor. 8/2557, as amended, and Clause 35(2) of the Notification No. Tor Lor Thor. 8/2557, the SEC has revoked the approval for acting as a securities investment consultant in accordance with the specified period.