THAILAND: RUBBER SAPLING VERDICT BOUNCES

C O N F I D E N T I A L SECTION 01 OF 02 BANGKOK 002418

SIPDIS

STATE FOR EAP/MLS, NSC FOR WALTON

E.O. 12958: DECL: 09/22/2019
TAGS: PGOV PREL KDEM TH
SUBJECT: THAILAND: RUBBER SAPLING VERDICT BOUNCES
CORRUPTION INDICTMENT OUT OF COURT

BANGKOK 00002418 001.2 OF 002


Classified By: DCM James F. Entwistle, reasons 1.4 (b, d)

SUMMARY AND COMMENT
--------------


1. (C) On September 21, the Supreme Court acquitted all 44
defendants -- including five former cabinet ministers under
fugitive former PM Thaksin -- of corruption and malfeasance
charges stemming from a 2003 rubber sapling procurement
project. Newin Chidchob, godfather of government coalition
partner Phumjai Thai, was the most prominent public figure
named in the case. The case was initiated by the Council for
National Security, the interim government appointed following
the 2006 coup, and the rubber sapling project was generally
cited by the coup plotters as one of the most egregious
examples of the type of crippling corruption that
necessitated the coup in the first place. Thaksin publicly
trumpeted the court decision as proof that the 2006 coup's
stated rationale had no merit.


2. (C) Comment: In the wake of the Supreme Court's judgment,
there has been a rush by politicians and analysts of all
stripes to frame the verdict as manifest evidence of the
politicization of the judiciary system, but the opposite may
well be true: the evidence in this case was weak enough that
the Office of Attorney General (OAG) refused to
endorse/prosecute it in March 2008, after which point the
National Counter Corruption Commission (NCCC) proceeded on
its own. The court's ruling essentially vindicated the OAG.
End Summary and Comment.

WHERE THE RUBBER MEETS THE ROAD TO JAIL (OR NOT)
-------------- --


3. (SBU) The so-called "rubber sapling case" originated in a
2003 Thaksin-era government scheme to distribute 90 million
rubber saplings to farmers in 36 northeastern and northern
provinces (Note: Thaksin's primary base of political support
was -- and still is -- in the north and northeast. End
Note.) The plan was initiated by current Phumjai Thai
figurehead Newin Chidchob, who at the time served as the
Deputy Agriculture Minister. The lucrative contract to
implement the project was quietly and opaquely awarded to a
politically well connected Thai firm -- the CP Group -- and
accusations of collusion and corruption quickly followed
suit.


4. (C) By the time of the 2006 coup, the rubber sapling
project had developed into a kind of metaphoric catchall for
the alleged waste and mismanagement of the Thaksin
administration, the time-honored justification for coups in
Thailand. Thaksin was toppled, the argument went, in order
to protect the country from corruption on that scale down the
road. As one of Thaksin's closest allies and the architect
of the scheme, there seemed little doubt that Newin's head
would be the biggest to roll.

MAKING THE CASE (POORLY)
--------------


5. (SBU) One of the post-coup interim government's first acts
was to establish the Assets Examination Commission (AEC).
The AEC was charged with investigating accusations of
Thaksin-era corruption, and to no one's surprise, the AEC
quickly took aim at the rubber sapling project. Beginning in
2007, the AEC started investigating the sapling project
bidding process and steadily worked on assembling its case.
By February 18, 2008, the AEC felt it had completed its work,
and referred the case to the Office of the Office of the
Attorney General (OAG).


6. (SBU) The OAG took issue with the quality of the evidence
presented by the AEC, however, and on March 14, 2008 the
OAG's office asked the AEC to expand its investigation,
interview more witnesses, and strengthen its case. In short,
the OAG felt the case was full of holes and needed to be
tightened up before bringing it to trial. The AEC disagreed,

BANGKOK 00002418 002.2 OF 002


and exercised its right to ignore the OAG's advice, opting
instead to forward the case as it stood to the Supreme Court.



7. (SBU) By the time the rubber sapling case landed on the
desk of the Supreme Court's Criminal Division for Persons
Holding Political Positions on August 6, 2008, the AEC's
mandate had elapsed, and the AEC had been replaced by the
National Anti-Corruption Commission (NACC) as the official
custodian of the rubber sapling case. The Supreme Court
accepted the case on September 23, 2008; 44 defendants were
officially charged with collusion in conjunction with the
rubber sapling procurement. In addition to Newin, four other
former cabinet members from the Thaksin administration were
also officially charged with collusion: ex-Deputy PM Somkid
Jatusripitak; ex-Agricultural Minister Sora-at Klinprathum;
ex-Commerce Minister Adisai Photaramik; and ex-Deputy Finance
Minister Warathep Rattanakorn. The other 39 defendants were
lower-level bureaucrats and representatives of private firms
involved in the bidding process.

THE VERDICT...SURPRISING, BUT NOT UNEXPECTED
--------------


8. (SBU) On September 21, the Supreme Court announced the
verdict: all 44 defendants were found innocent on all
charges. All but one of the defendants were on hand to hear
the verdict, with Adisai having taken the precaution of
leaving the country beforehand to insure against the
possibility of a jail sentence (Note: The court revoked the
warrant for his arrest following the innocent verdict. End
Note.)


9. (SBU) No one on hand was more ecstatic than Newin, who
faced the possibility of several years of prison time for
violating procurement guidelines, the Criminal Code and other
laws. Perhaps just as importantly from his perspective, a
guilty verdict would have significantly reduced his political
influence at arguably the apex of his career. Shedding
tears, Newin gushed that all he had left to do was to serve
his monarchy loyally.


10. (C) Cynicism by the many who assume the verdict related
more to Newin's alliance with the current government than any
facts of the case aside, some of our contacts saw this
verdict coming for legal, legitimate reasons. Prinya
Thaewanarumitkul, the Vice Rector of Thammasat University,
told us that the prosecution mounted a flimsy case based
almost entirely on hearsay. Of all the Thaksin-era
corruption cases, Prinya felt this was the weakest, noting
that the AEC compounded matters by naming too many people as
defendants in the case. Though he understood the skepticism
with which many people greeted the verdict, he felt that the
judges appointed to the Supreme Court body which decided the
case were beyond reproach. In his view, this was an example
of good judges making the right determination on a bad case.


11. (C) Not surprisingly, Supachai Jaismut, the Deputy
government spokesman and FON (friend of Newin),told us he
believed the case was weak and had expected an acquittal all
along. Interestingly, Supachai also told us that Newin knew
of the outcome ahead of time, though he declined to explain
precisely how.


12. (C) Klanarong Chantik, a member of the NCCC and former
member of the AEC defensively took issue with complaints
about the AEC and NCCC's handling of the case. Klanarong
told us: "the AEC and the NCCC left every stone unturned."
The AEC and NCCC, he added, had thoroughly investigated the
case and provided exhaustive legal and factual backing to
support it. He maintained that the Supreme Court's verdict
should in no way be used to impugn the AEC and NCCC's work,
and added that in his mind, the case was closed, and it was
time to move on.

JOHN