Britons arrested in Thai shares scam

A bus carrying the detainees in Thailand

Up to 40 Britons are among 84 people arrested in Thailand on suspicion of being involved in a multi-million dollar share-selling fraud.

Thai police said telephone sales staff from two companies in Bangkok cheated more than 100 investors out of around £153m, selling stocks which customers often never received.

The company set out to defraud people by saying that their money would be invested in the stock market

Thai Police

The arrests, which include British, Irish, American, Canadian, and Australian nationals and citizens of several European countries, were made after a two-year investigation.

BBC correspondent Gina Wilkinson in Bangkok says it is being described as one of the world's largest global stock-dealing scams.

Assets valued at £4m, including 35 boxes of documents, 20 computers and large amounts of cash, were also seized from the offices of the Brinton Group and Benson Dupont Capital Management in the Thai capital's central business district.

The Australian, British and Irish nationals were reportedly hired in Bangkok to cold call overseas homes and businesses, particularly in Australia New Zealand and persuade them to buy non-existent stocks.

Thailand's Securities and Exchange Commission (SEC) said in a statement: "High pressured selling tactics were allegedly used."

Backpackers

Some are thought to have worked from bases in Tokyo and Hong Kong.

"The company set out to defraud people by saying that their money would be invested in the stock market," said deputy police chief Sant Sarutanond.

"Many complaints showed that after the money was transferred to Bangkok accounts, either investors had problems getting their money back or no further contact could be made to the brokers at all," he added.

Initially the foreigners, some of whom are reportedly backpackers, were charged over violation of work permits.

Thirty to 40 British nationals were arrested

Foreign Office

It is not known where they are being held, but it is thought likely some are being kept at Bangkok's immigration detention centre.

A Foreign Office spokeswoman said: "Thirty to 40 British nationals were arrested."

British Embassy staff in Bangkok would visit any Britons still detained on Friday, she added.

While the Australian Embassy said that seven of its nationals were currently being questioned.

The two year investigation, also involving US and Australian authorities, is said to have been prompted by complaints by security regulators in Australia, New Zealand and Hong Kong.

Money laundering

The investigation has taken so long, says Gina Wilkinson, because the firms have frequently changed their names and addresses.

There are also reports that they were involved in an international money laundering ring, with large amounts of money leaving Thailand.

However, police say they have not caught the ringleader of the operation, according to reports by foreign news agency AFP.

The maximum penalty for fraud in Thailand is seven years in prison.

Maximum sentence

Trading securities without permission carries a maximum sentence of five years' jail and a fine of more than £7,500.

Prime Minister Thaksin Shinawatra said Thailand's laws needed to be reviewed to prevent such fraudsters from operating out of the country.

Similar scams were also uncovered in the Philippines capital Manila earlier this month.

Fifteen people were picked up and detained in a raid on offices in the city's Makati financial district.