In one of Thailand’s largest economic crime operations this year, authorities conducted simultaneous raids on 14 locations across the country—including Tak, Chiang Mai, and Bangkok—targeting a criminal network accused of orchestrating a billion-baht VAT fraud.
The crackdown, announced at a press briefing on Monday, was led by Maj Gen Natthasak Chaovanasai, Deputy Commissioner of the Central Investigation Bureau (CIB), alongside top officers from the Economic Crime Suppression Division (ECD) and the Revenue Department.
The operation resulted in the arrest of Samran, 63, the alleged mastermind, along with nine accomplices. They face multiple charges, including issuing false tax invoices and illegally claiming VAT refunds through fraudulent transactions.
How the VAT Scam Worked
According to authorities, Samran established a front company named S & M Brotherhood Co., Ltd., registered as an import-export business. Through this, he allegedly created a network of over 20 VAT-registered shell companies run by family members, relatives, and associates.
These companies faked commercial transactions with no actual exchange of goods. Tax invoices were passed along a chain of these entities, artificially inflating product prices and generating higher VAT amounts.
At the final stage, S & M Brotherhood “purchased” these over-priced goods, documented them as exports to Myanmar — where the supposed buyers were also part of the criminal ring. This allowed the syndicate to file false export documents and fraudulently claim 7% VAT refunds from the Revenue Department.
“The goods they claimed to export, mostly consumer products, are VAT-exempt when shipped out of the country, but this group manipulated the input tax to illegitimately claim monthly refunds,” explained Pol Maj Gen Thatphum Charuprat, Commander of the ECD.
Scale of the Fraud and Damages
Investigations revealed that between 2021 and 2022 alone, the syndicate illicitly claimed over 150 million Baht in VAT refunds. Authorities estimate total damages to the Thai treasury exceeding 1 billion Baht.
The crackdown followed a formal complaint by the Revenue Department against Samran’s operations, prompting a monthslong investigation. During the raids, officers seized over 100,000 documents, 20 mobile phones, and 30 computers, providing irrefutable evidence of the fraudulent scheme.
Some suspects have confessed, while others continue to deny involvement. All detainees have been handed over to ECD Sub-Division 2 for further legal proceedings.
Authorities Vow to Plug Loopholes
Officials acknowledged that this fraud exploited gaps in VAT refund regulations, particularly on zero-rated exports of consumer goods. The Revenue Department has pledged stricter controls on VAT refunds, improved digital tracking of trade documents, and tighter vetting of high-volume exporters.
“The coordination between criminal networks and fake export records is a serious threat to our tax system,” Maj Gen Natthasak noted, adding that authorities are now investigating potential connections to other fraud rings and international collaborators.
This case highlights the growing sophistication of white-collar crime in Southeast Asia and the need for stronger financial oversight.