CHIANG MAI, THAILAND – A large-scale police operation targeted illicit “straw man” businesses in northern Thailand on Wednesday. The police, deploying 188 officers, focused on companies in Chiang Mai believed to be operated by foreign nationals using Thai nominees. During the operation, two hotels and several businesses lacking actual offices were identified, alongside violations of immigration laws.
Large-scale Raid with 188 Officers in Tourist Hub
Police Major General Yutthana Kaenchan, the Provincial Police Chief of Chiang Mai, ordered the coordinated action against these illegal operations. A team, accompanied by administrative officials, worked to scrutinize the structures of foreign-owned businesses. The message from authorities is clear: a stricter government policy is being enforced to halt the negative impacts these enterprises have on local competition and the domestic economy.
What Lies Behind the New Approach in the North?
Yutthana Kaenchan directly confirmed that Chiang Mai province is now a specific target. This action is an expansion of the so-called “Koh Phangan Model.” This model signifies the active dismantling of illegal foreign business activities, which originally began on the popular party island in Surat Thani province. The campaign has now reached the northern tourist hotspot.
The Koh Phangan Model Reaches the North
What commenced on the island in the Gulf of Thailand is now being applied comprehensively. Investigators are examining not only the outward appearance but the entire corporate structure to unmask straw man arrangements. In these setups, Thai individuals legally hold shares, assets, and business licenses on paper. In reality, however, foreign investors own and control the businesses, thereby circumventing legal restrictions.
Violations of Hotel and Immigration Law Immediately Identified
The operation in Chiang Mai uncovered numerous violations on its first day. According to Police Major General Yutthana Kaenchan, two hotels were identified as violating the Hotel Act. Additionally, officers uncovered three violations of the Immigration Act. A group of companies is suspected of illegally holding assets in the names of foreigners through Thai nominees.
Gathering Evidence for Criminal Prosecution
Beyond the hotels, investigators notably identified eleven companies whose supposed offices existed only on paper. Officers searched in vain for physical offices at the registered addresses. “The affected organizations are gathering evidence and expanding investigations to prepare for criminal prosecution,” the police commander clarified. The focus is on restoring order to local business and protecting the national economy.
Large-scale Raid Against Foreign Shell Companies in Chiang Mai
Police aim to tighten the noose and utilize the gathered intelligence for indictments. Following the Koh Phangan Model, this could be the beginning of a much broader cleansing operation in northern Thailand. Police Major General Yutthana Kaenchan stated that authorities are adhering to government policy to combat illegal foreign business practices, intending to rectify the situation for concerned local businesses and safeguard the national economy.