The Thai Securities and Exchange Commission (SEC) is under scrutiny this week after individual investor, identified as Supaporn Pimphong, has reported a trade bringing her ownership of telco True Corporation to 7% – but the telco says it has doubts the trade really took place.
The discrepancy came to light when True asked the SEC to verify a filing showing Supaporn had acquired a roughly a 3.2% stake from UBS Group AG on June 15.
This acquisition would raise Supaporn’s position to around 7.1%, worth around 32.5 billion Baht ($1 billion), making her one of True’s largest stakeholders.
Further confusing matters, Supaporn’s filing claimed the purchase included both ordinary shares and a block of ‘preferred shares’. True Corp, however, says it has never issued preferred shares and have none outstanding in their capital structure.
The SEC has subsequently launched a probe into the matter.
An individual investment of this scale is always noteworthy, but the lack of information surrounding Supaporn’s identity makes the apparent mistakes in this filing particularly concerning.
Initial investigations into her identity by Thai media outlet Khao Hoon uncovered no information regarding her business background, investment track record, or preexisting wealth portfolio. What they did find, however, was that since 2018 Supaporn had filed massive ownership positions in major Thai blue-chip companies, including a 49% stake in GJS Steel and positions over 5% in Bangkok Bank, Kasikornbank, an Asia Aviation. Combined, these stakes would be worth around $1.5 billion, not including Supaporn’s supposed $1 billion stake in True.
The Stock Exchange of Thailand (SET) and the respective companies’ shareholder registries have since confirmed that none of these positions officially exist.
So, what exactly is going on here? It seems highly likely that Supaporn does not really exist, but what is the point of the deception?
One theory is that this is a form of stock market ‘pump and dump’, with the fake positions being filed to artificially inflate stock prices before the sale of the owner’s real shares.
Another theory, proposed by Kasikorn Securities, suggests that the transfer of shares may have indeed taken place, with the Supaporn filing used to conceal the identity of the real final owner and mask financial restructuring.
The report notes that the True transaction perfectly aligns with UBS AG London Branch acquiring shares from Charoen Pokphand Group, a billionaire conglomerate and True Corp’s largest shareholder.
Regardless of the whether the transaction in fact took place here, the finding severely undermines the viability of the SEC’s reporting mechanism. The filing of a Form 246-2 requires encrypted user registration, identity verification against a national database, and validation of the underlying assets being traded by a brokerage; if these guardrails are somehow compromised, the validity of all the SEC’s public financial disclosures could be at risk.
The SEC is currently working with the SET for an emergency overhaul of their combined data infrastructure to address any weaknesses, but it could be some time before the extent of these systemic issues are fully revealed.
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