The Criminal Court has acquitted Prachai Leophairatana and his four younger siblings of siphoning off 956.8 million baht from Thai Petrochemical Industry Plc (TPI) when the company underwent rehabilitation.
The five -Prachai, Prateep, Pramual, Prayad and Malinee Leophairatana - executives and directors of TPI, were accused by the prosecution last year of siphoning off the money through four lease contracts under which TPI rents office space at TPI Tower in Bangkok from Pornchai Enterprises Co, which is owned by the Leophairatanas. The lease agreements were sealed between 1995 and 1999 and some were signed while TPI was in the middle of rehabilitation as ordered by the Bankruptcy Court in the wake of the economic crisis in 1997. Pornchai Enterprises was among the accused.
The prosecution said TPI, authorised by the siblings, was to rent the building for over 90 years without registering the rental agreement, and that it managed to pay rental fees of 956 million baht to Pornchai Enterprises in advance. Since TPI was a listed company, the action affected its shareholders in general and was detrimental to the firm's financial standing, as per the prosecution.
But the court agreed with the defendants' reasoning that the long-term lease did good to the firm because the rental was equivalent to only 1.8 million baht a month and that rental contracts were a normal business practice. The court found the lease agreements did not affect the company's shareholders or have any negative impact upon TPI's liquidity.