By k on October 30, 2009

BANGKOK, Oct 30 (TNA) – Thai Prime Minister Abhisit Vejjajiva on Friday said legal action would be taken against politicians allegedly implicated in the embezzlement case which brought down the Bangkok Bank of Commerce (BBC) in 1995.

The prime minister made the statement one day after Canada’s Supreme Court dismissed a petition filed by fugitive Indian-born ex-financier Rakesh Saxena in which he tried to overturn a lower-court decision upholding the extradition, and he was en route to Thailand Friday night, ending his 13-year fight against extradition, one of the longest-contested extradition cases in Canadian history.

Once Mr Rakesh is brought to Thailand, he will be taken to trial according to legal procedures. If the investigation finds any politician or group of politicians to be implicated in the case, they will be prosecuted based on the established facts, Mr Abhisit said.

“The government will not protect nor influence the case nor harass anyone, but justice will run its course,” the Thai prime minister said.

Some politicians reportedly reaped benefits from phony loans extended by the BBC.

In 1995, Mr Saxena, then treasury adviser of the BBC allegedly colluded with Krirkkiat Jalichandra, then president of the bank, and was involved in setting up dummy loans and fabricated accounts to siphon millions from the bank, causing its collapse under US$3 billion in debts, along with 50 other financial institutions, leading directly to the 1997 financial crisis.

Mr Krirkkiat was arrested, tried and sentenced to 30 years in prison plus a fine of Bt330 million.

Politicians in the so-called “Group of 16″ were accused as having close connections to Mr Saxena and that they conspired to receive undeserved loans from the bank. Those include Newin Chidchob, a shadowy leader of the Bhumjai Thai Party, a key coalition partner in the Abhisit government.

The Group of 16 is comprised of young politicians, mainly in their 30s and early 40s, from different parties.

Established in 1992, the group’s original leadership included political notables such as Newin, Suchart Tancharoen, and Phairoj Suwanchawee.

The group broke up after the BBC scandal revealed during the no confidence debate, the group members who were ministers in the Banharn Silpa-archa government resigned.

Mr Saxena fled to Canada after the Thai government seized the BBC to stop a run on deposits triggered by a Bank of Thailand report that about US$88 billion of the bank’s loans were phony.

He was arrested by the Canadian authorities in July 1996. (TNA)

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