Thai SEC takes action against British adviser

Thailand’s Securities & Exchange Commission has filed a criminal complaint against a British national, Richard Dunston Malpass, on the grounds that he operated a securities business in the country without a licence.

In a statement on its website, the Thai SEC said it had filed the complaint with the Economic Crime Suppression Division of the Royal Thai Police (ECD Police), after having heard from “several foreign investors” who claimed that Malpass “had solicited them to transfer their pension funds from overseas to make investments based on his advice, for the sake of tax benefits and long-term returns”.

The investors followed his advice, and then “suffered loss”, the statement adds.

It goes on to say that Malpass was not licensed to operate a securities business, and therefore stood liable to a penalty of two to five years in prison, and a fine of as much as THB500,000 (£9,800, $14,100), “plus a daily fine of THB10,000 until the period of violation ends”.

Malpass couldn’t immediately be reached for comment.

In its statement, the SEC urged “anyone who may have been affected” by Malpass’s “unlicensed securities business operation” to contact the ECD Police.

On Tuesday, a former Malpass client, who currently lives in Bangkok, said it was thought that, in filing the complaint against Malpass, the Thai SEC was responding to a group complaint it’s received from more than 30 investors who lost savings in the 2013 collapse of a Queensland, Australia-based property fund provider known as LM Investment Management.

Many of these investors had put most if not all of their retirement pots into the LMIM Managed Performance Fund in particular, via qualifying recognised overseas pension schemes and offshore bonds, and as a result have lost most if not all of their investments.

The Managed Performance Fund, a wholesale product, was an unregistered managed investment scheme, according to Australia’s regulator, the Australia Securities & Investments Commission, and because such schemes are not offered to retail investors in Australia, they are not required to be ASIC registered.

Second complaint

The complaint filed on Tuesday was the Thai SEC’s second action against an expat-focused financial services practitioner. In July, it filed a similar action  against an entity known as Professional Portfolio International (PPI), a financial planning and wealth management business with an office in Bangkok, and two of its employees, also for operating a securities business without a licence.

As with its latest action, the SEC said it had received a complaint from an expat investor living in Thailand that PPI had advised them to to transfer money from their overseas pension funds into PPI-recommended investments. “The complainant fell into the trap and later suffered damage from the investment,” the SEC said in that statement.

In response, Eric Jordan, managing director of PPI, told a journalist at the time that he had been told “a number of times over the years” by the SEC years that an SEC licence was “not required for our business practice”, but that, as the licensing issue was now being brought to light, the company would now be engaging with the Thai regulator,  and that it intended “to cooperate in full with any guidance that is received”.

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