THAKSIN SHINAWATRA'S LEGAL TEAM PESSIMISTIC ABOUT

C O N F I D E N T I A L SECTION 01 OF 03 BANGKOK 002092

SIPDIS

NSC FOR PHU

E.O. 12958: DECL: 07/09/2018
TAGS: PGOV PHUM KDEM KJUS TH
SUBJECT: THAKSIN SHINAWATRA'S LEGAL TEAM PESSIMISTIC ABOUT
CASES IN PROCESS

REF: A. BANGKOK 189 (SUCCESSFUL PROSECUTION UNLIKELY)

B. 07 BANGKOK 3530 (THAKSIN TO FIGHT EXTRADITION)

C. 07 BANGKOK 1492 (THAKSIN BIDING HIS TIME)

D. 06 BANGKOK 7594 (SCRAMBLING TO BUILD CASE)

E. 06 BANGKOK 2425 (IT'S A MESS)

Classified By: Ambassador Eric G. John, reason: 1.4 (b) and (d).

SUMMARY
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1. (C) Former Prime Minister Thaksin Shinawatra and his wife
are now on trial for alleged abuse of power in connection
with a 2003 purchase of a plot of land from a
state-affiliated institution. This trial may conclude as
early as September. Thaksin's wife also appears likely to be
convicted in an ongoing trial for tax evasion. A recent
Constitutional Court ruling struck down a challenge against
the Asset Examination Committee (AEC),the body investigating
Thaksin-era corruption. The AEC's term has ended and the
National Counter Corruption Commission (NCCC) is taking up
its work. A lawyer working for Thaksin discussed these
developments with us and complained of widespread judicial
bias against Thaksin, which manifested itself in, among other
instances, the entrapment and imprisonment of members of
Thaksin's legal team when they tried to provide court
officials with a payoff. The judiciary may prove capable of
marginalizing Thaksin, but risks a perception that the courts
are increasingly politicized. End Summary.

"ABUSE OF POWER" TRIAL BEGINS, TAX TRIAL NEARS END
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2. (U) On July 8, the Supreme Court's Criminal Division for
Political Office Holders began the trial of former Prime
Minister Thaksin Shinawatra and his wife, Potjaman, for abuse
of power. The charge stems from Potjaman's 2003 purchase of
land from the Financial Institutions Development Fund (FIDF).
(Ref A provides further background on this case.) Neither
Thaksin nor Potjaman attended the July 8 court session.


3. (U) Meanwhile, a criminal court is poised to conclude an
ongoing trial in which Potjaman stands accused of tax evasion
relating to transfers of corporate shares between herself and
her step-brother, Bannapot Damapong, in 1997. (Ref D
provides further background on this case.) Both prosecutors
and the defense are preparing their closing statements, and
the verdict is due to be delivered on July 31.


4. (C) Manida "Micky" Zinmerman, a partner with the U.S. law
firm Hunton and Williams who also works in an individual
capacity on Shinawatra family legal affairs, told Deputy
Political Counselor on July 7 that the Shinawatra legal team
fully expected that Potjaman would be convicted in the tax
evasion case. The team expected she would remain free on
bail, however, and appeals would continue for years.


5. (C) Micky worried that the Supreme Court would rush
forward to conclude the abuse of power case by the end of
September. She explained that the current panel of Justices
in this case would be subject to a reshuffle on/about October
1, as some members faced mandatory retirement. Micky
assessed the current panel as strongly biased against the
Shinawatras and believed they would move to deliver a guilty
verdict in advance of the reshuffle. (The panel has
scheduled three sessions between August 26 and September 2
for a final phase of cross-examination in this case; Supreme
Court staff have told us that verdicts are typically
delivered approximately 45 days after cross-examination
ends.)

CONSTITUTIONAL COURT SAVES AEC; NCCC ASSUMES CASES
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6. (U) Several other important cases against Thaksin and his
associates will soon be considered by the Supreme Court's
Criminal Division for Political Office Holders. These cases
include:


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- Allegations that the Thaksin administration acted illegally
in establishing a government lottery program;

- Allegations of corruption in the procurement of rubber
saplings; and

- Allegations of damages to the state caused by provisions of
Export-Import Bank of Thailand loans to Burma, a substantial
portion of the total having been designated for
telecommunications projects involving the Shinawatra family
conglomerate.


7. (U) The aforementioned cases, among others, were
investigated by the Asset Examination Committee (AEC),which
was established after the 2006 coup d'etat in order to
document Thaksin-era corruption. The AEC had sought to file
the three cases in para six directly with the Supreme Court,
bypassing the Office of the Attorney General, but the Court
declined to process the AEC's request pending a
Constitutional Court ruling on the constitutionality of the
AEC's actions. A June 30 ruling by the Constitutional Court
determined the AEC has acted in accordance with its
authority. It is not yet clear when the aforementioned cases
might move to trial, if accepted by the Supreme Court. The
AEC's term ended on June 30, and its incomplete tasks have
been passed over to the National Counter Corruption
Commission (NCCC).


8. (C) Shinawatra lawyer Micky Zinmerman told us on July 8
that she had been surprised by the unusual speed with which
the Constitutional Court handed down its ruling affirming the
constitutionality of the AEC's activities. She interpreted
the quick judgment as indicative of a widely rumored
Constitutional Court bias against Thaksin.

THAKSIN'S FROZEN FUNDS
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9. (C) Liquid assets totaling approximately 2 billion USD
belonging to Thaksin and his family were frozen by a June
2007 AEC order. With the AEC now dissolved, Micky told us
that the National Counter Corruption Commission (NCCC)
appeared to be the proper body to receive Thaksin's request
for the release of these funds. Micky said it appeared
clear, however, that the NCCC would not release the bulk of
the funds until the courts processed all cases involving
allegations that Thaksin had benefited from corruption or
caused the state to incur financial losses. The AEC, prior
to its dissolution, had approved the release of 100 million
Baht (approximately 3 million USD) for Thaksin's legal
expenses, however. Thaksin's team was also trying to obtain
a written opinion from the Attorney General's Office to
support a request for the release of funds that Thaksin could
document having obtained prior to becoming Prime Minister.

THAKSIN SIDE ADMITS BRIBE, COMPLAINS ENTRAPPED
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10. (C) Micky also discussed the June 25 verdict against
three members of Thaksin's legal team -- lead lawyer Pichit
Chuenban, team coordinator Thana Tansiri, and legal assistant
Supasri Srisawat. All three received six month jail
sentences after being found by the Supreme Court to be guilty
of contempt of court following a June 10 incident in which
Thana provided a court official with a snack box containing 2
million Baht (approximately 60,000 USD).


11. (C) Although the three members of the legal team have
denied involvement or claimed inadvertant delivery of the
snack box, Micky admitted to us that the lawyers involved in
the incident had provided the money as a payoff to court
officials. She complained, however, that they had done so at
the request of a court official, who appeared to be part of a
scheme to entrap the team. Micky said this payoff appeared
so clumsy that she and others had wondered whether Pichit
and/or Thana had decided deliberately to betray Thaksin and
might point the finger at him. She asserted that Thaksin had
known nothing of the payoff, and that a mere 2 million Baht
expenditure in the course of his defense did not require

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Thaksin's approval.


12. (C) Micky considered the "entrapment" of these members of
the legal team to be part of a wider offensive against
Thaksin and his allies. She also said:

- When the Thaksin team filed a lawsuit against the Director
General of the Revenue Department for collaborating with the
AEC, the pro-Thaksin lawyer associated with the lawsuit
documents was subjected to a Revenue Department audit.

- Thaksin's team was surprised by a recent decision, made
public on July 3, in which the Supreme Court denied
permission for Thaksin to travel abroad. The Supreme Court
cited the ongoing "abuse of power" trial proceedings. Micky
claimed Thaksin's team members viewed this denial of
permission as unusual and unwarranted, and they may file for
reconsideration.

- Roughly one-third of the 80-90 active Supreme Court
Justices were biased against Thaksin, while the remainder
were either sympathetic or neutral.

- All members of the National Counter Corruption Commission
(NCCC) -- which has now taken on the role previously played
by the AEC -- were biased against Thaksin. (Comment: The
current NCCC Commissioners were appointed on September 22,
2006, by the leaders of the 2006 coup d'etat; it is not
irrational to presume, therefore, that they are generally
predisposed against Thaksin. End Comment.) However, she
observed that the NCCC, unlike the AEC, had well-established
procedures and professional staff members, who might prevent
the NCCC Commissioners from acting as aggressively as the
AEC's members.

COMMENT
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13. (C) In the immediate aftermath of the pro-Thaksin party's
victory in the December election, it appeared as though the
political climate might preclude effective prosecution of
Thaksin (ref A). Now, however, it seems as though Thaksin
faces an uphill fight, at least in some cases. The prospect
of Thaksin's prosecution may reassure his opponents, who
might otherwise confront Thaksin's allies (the current
government) through street action. The People's Alliance for
Democracy was energized this spring to fight the government's
proposal to amend the Constitution, largely because such a
move was seen as having the potential to undercut the AEC and
the cases it had built.


14. (C) The courts may prove capable of marginalizing
Thaksin, either by incarcerating him or by tarnishing his
reputation beyond repair. It is possible that Thaksin's
conviction in one or more cases would represent a
straightforward dispensation of justice, as we believe he
likely used his authority as Prime Minister to benefit
himself and his cronies. However, we also note that there is
an increasing perception among Thais that the judiciary has
become politicized; this perception has grown ever since a
watershed speech in April 2006, in which King Bhumibol called
on the judiciary to take action to resolve the ongoing
political crisis (ref E). While the courts currently have
the requisite level of prestige and credibility to
marginalize Thaksin -- a goal that the Army proved incapable
of achieving in the 2006-07 period -- the judiciary may also
suffer in the long term, as it moves beyond its traditional
role and increasingly serves as a decisive instrument for
shaping political life.
JOHN