Tracing the Shinawatra hidden assets controversy

The case of more than 4.4 billion baht in promissory notes (PN notes) linked to Prime Minister Paetongtarn Shinawatra was brought up during a non-confidence debate in Parliament on Monday by Wiroj Lakkhanaadisorn, an MP of the People’s Party (PPLE). Wiroj alleged that the transaction may constitute a concealed legal act and could amount to at least 218.7 million baht in tax evasion.

The declaration of assets and liabilities submitted by Paetongtarn upon assuming office as prime minister in 2024 included nine PN notes held by family members. Wiroj said five individuals involved in the transaction should be liable for at least 218.7 million baht in taxes. They are:

Pinthongta Shinawatra Kunakornwong (elder sister)
Panthongtae Shinawatra (elder brother)
Bannapot Damapong (uncle)
Butsaba Damapong (aunt-in-law)
Khunying Potjaman Na Pombejra (mother)

However, Wiroj clarified that Paetongtarn’s intention may not have been to evade more than 218 million baht in taxes. Instead, he suggested that the Shinawatra family were engaging in asset transfers within their financial network, similar to tactics allegedly used in 2001. At that time, assets were not only moved around but shares were also hidden under the names of domestic workers and drivers. 

While such actions may have been possible back then, when gift-tax laws were not in place, since February 1, 2016, all gifted assets are subject to taxation.

Before fully venturing into politics, Thaksin Shinawatra and Khunying Potjaman, Paetongtarn's parents, transferred their shares – worth more than 11 billion baht – to domestic workers, drivers, and security personnel. This amount accounted for one-fourth of their total holdings. 

As Thaksin pursued his political career, he gradually transferred these shares to his children and relatives. This process continued until he assumed ministerial positions in the Chuan Leekpai government and the Chavalit Yongchaiyudh government.

The issue resurfaced ahead of the 2001 general election when Thaksin had founded the Thai Rak Thai Party. A petition was filed with the National Anti-Corruption Commission (NACC) requesting an investigation into Thaksin’s asset declaration during his tenure as deputy prime minister in Chavalit’s administration. 

The complaint alleged that Thaksin may have filed a false asset declaration, as billions of baht worth of shares were still officially registered under the names of domestic workers and drivers.

The NACC unanimously ruled that Thaksin had deliberately filed a false asset declaration and referred the case to the Constitutional Court for a verdict.

Despite this controversy emerging just before the 2001 general election, Thaksin’s popularity was at an all-time high, leading Thai Rak Thai to a landslide victory and securing Thaksin’s first term as prime minister.

During his defence before the Constitutional Court, Thaksin famously argued that he had made an “honest mistake”. In a highly controversial 8-7 ruling, the court found that Thaksin had not intentionally filed a false asset declaration, despite heavy public criticism at the time.

While this marked the end of the first hidden-shares case, a second hidden-shares controversy later emerged. This ultimately led to a Supreme Court ruling in the political officeholders’ criminal division, resulting in a 46-billion-baht asset-seizure case against Thaksin.

Paetongtarn’s PN Holdings and a Comparison to Thaksin’s Asset Declarations

The latest issue revolves around Paetongtarn’s disclosure of nine promissory notes (PNs) worth more than 4.4 billion baht in the liabilities section of her asset declaration. Notably, all five individuals listed on the PNs are closely related family members of Paetongtarn.

This case has drawn comparisons to Thaksin’s past asset declarations, when he reported “loans” exceeding 5 billion baht to his son and sister.

When Thaksin assumed office as prime minister for the first time in 2001, he declared loans amounting to 429.2 million baht, of which 409 million baht was lent to his son, Panthongtae. Meanwhile, his former wife, Khunying Potjaman, reported loans totalling 6,787,638,193 baht, with 5,056,348,840 baht lent to Panthongtae.

After stepping down as minister of education in Gen Chavalit Yongchaiyudh’s government and completing the one-year mandatory declaration period, Thaksin reported loans of 429.2 million baht, with 409 million baht lent to Panthongtae and 20 million baht to his younger sister, Yingluck Shinawatra, who later became prime minister in 2011.

Upon assuming office for his second term as prime minister in 2005, Thaksin declared loans of 409.2 million baht to Panthongtae. Meanwhile, Khunying Potjaman reported that Panthongtae’s outstanding debt had decreased to 2.595 billion baht from the more than 5 billion baht initially reported in 2001.

However, what is particularly surprising is that just a year later, in 2006, when Thaksin declared his assets after stepping down as prime minister, he reported no outstanding loans. At the same time, Khunying Potjaman declared only 28 million baht in loans. 

This suggests that the 409.2 million baht lent by Thaksin to Panthongtae and the remaining 2.595 billion baht lent by Khunying Potjaman to Panthongtae had completely disappeared.