This weekend an article appeared on the BBC website about property scams in Phuket. Given I’ve owned an apartment in Phuket for the last 5 years, I was interested to see how these scams worked.
British expat Ian Rance and Irishman Colin Vard are now living almost penniless with their children on the outskirts of Bangkok as they struggle against overwhelming odds to recover properties they bought on Phuket. Both men lost all their investments through frauds that neither of them imagined were possible.
Frauds? Okay, I’m intrigued.
“I’d made my money in England and had enough to retire I thought. I was looking for a place that was warm, a place that had some rule of law, where I could live in safety and peace,” says Rance, a chartered surveyor and professional arbitrator from Hertfordshire, who arrived in Phuket in 2000.
Uh-huh. With you so far.
In 2001 Rance met and married a Thai woman called Suda and went on to have three children with her.
Uh-oh. I can see where this is heading.
The prime minister at the time, Thaksin Shinawatra, had started a programme called “Thailand Elite”, through which he hoped to attract wealthy foreigners to settle by allowing them to own small amounts of land, something not normally permitted under Thai law.
Encouraged by this, Rance began investing in property, buying two houses, and eventually a restaurant and two pieces of land.
But the Thailand Elite scheme never took off, so in the end he did what thousands of other foreigners did
Pulled out of the deal and invested elsewhere?
he put the properties either in the name of the company he had already formed to run his consultancy business, or in the name of his wife.
The family home was in his wife’s name, but leased to him on a 30-year lease.
Sounds legit. I mean, which man doesn’t have his family home in his wife’s name and leased back to him?
The company was nominally Thai-owned but Rance, as a director, had majority voting rights – nothing could happen to the company’s assets without his approval. He was advised by local lawyers that this was legally quite safe.
He didn’t own his company but he had majority voting rights. What could possibly go wrong?
But unbeknown to him, in July 2008 Suda began transferring the properties out of the company. In September she also removed Rance as a director. On paper none of this should have been possible. In practice, all she had to do was to forge her husband’s signature.
So his wife, who he appeared to have married less than a year after arriving in Thailand with his pockets full of cash, forged his signature and ripped him off. Aside from the fact that he should have seen this coming a mile off, a wife forging a husband’s signature in the course of fleecing him or somebody else is hardly unique to Thailand, is it?
The Land Office in Phuket, where property transfers are formalised, was willing to accept a simple forged power of attorney from Rance to change ownership of properties worth hundreds of thousands of pounds, and to cancel his 30-year lease on their home.
Presumably the Phuket Land Office should assume ageing expats are being ripped off by their Thai wives as a matter of course and, in contrast with the rest of the world, not recognise power of attorney documents.
To change the control of the company the forged signature had to be notarised by a lawyer – but that presented no problem. A local lawyer did this willingly, without Rance being present. When the BBC confronted the lawyer about this he admitted the signature was his, but claimed it was normal practice in Phuket.
Just as it is normal practice for expats to circumvent Thai ownership laws by running everything through a “local” company while retaining (hopefully) all control. Funny that expats have few concerns engaging in legal gymnastics in order to set themselves up with a cushy life in Thailand, and then complain about dodgy practices used to strip them of everything a few years later.
But Rance’s attempts to sue the lawyer have got nowhere.
I don’t think we’re in London any more, Toto.
He only spotted the fraud in July 2010, when checking his company’s tax status.
According to the article, she started transferring the properties in 2008. What kind of director – other than one who is nothing of the sort and became one only to circumvent Thai property laws – would allow fraud on this scale to go unnoticed for 2 years?
He discovered that all five properties, worth well over £1m ($1.5m), had been stolen. What began then was, he says, a nightmare period for him.
No, the nightmare started when you married a Thai girl a year after arriving in Phuket. You just didn’t realise it.
His wife ran away.
Say it ain’t so!
Four men came into his house and threatened his life if he did not get out of Phuket. His wife phoned him and told him they would kidnap the children if he did not leave the house immediately.
At which point it dawned on him that the sweet, smiling girl he’d met dancing on that bar back in 2000 was in fact a hardened criminal.
The evidence Rance has amassed is staggering. Document after document shows the same land agent and two moneylenders, transferring the properties back and forth to his ex-wife in a form of pawnbroking, where she was in effect borrowing at astronomical rates of interest, using the properties as collateral.
None of which he was able to spot for two years as “director” of the company which he thought owned the properties. What’s that saying about a fool and his money?
She was arrested in 2010, and is now serving a four-year prison sentence.
Ah, so justice prevailed after all. What’s the issue, again?
But nothing has happened to any of the other parties linked to the fraud.
I suspect this is because there is no document showing that they knew the signature had been forged when the property was transferred at the Phuket Land Office. Of course, they would have known, but there is no evidence to show they did. And Thailand, backward nation that it is, usually requires documented evidence of criminality in order to prosecute.
Rance has filed nine criminal and civil suits against them. He has had to travel to Phuket for every hearing, paying for himself, a lawyer, and a translator – hearings which are usually many months apart, and sometimes cancelled at the last minute.
Unlike everywhere else in the world where fraud cases involving treacherous ex-wives are cheap, simple, and closed out within a week with the utmost efficiency.
Worse, one of the moneylenders has filed a perjury case against Rance, claiming that he knew about the fraud all along.
A reasonable claim, given he was supposed to be the company director. “Were you corrupt or merely stupid, sir?”
Over five years Rance estimates he has spent the equivalent of £200,000 ($300,000) on legal fees and other costs relating to the legal battle.
Rance has hired five lawyers, some of whom he says have overcharged him and sometimes deliberately sabotaged his cases.
Not content to see his Thai bride walking off with his properties, he’s decided to hand over another £200k to dodgy Thai lawyers. Has this company director never heard of cutting one’s losses?
The only case he has won resulted in the imprisonment of his ex-wife and the restoration of his company directorship. Yet the same judge ruled that he had no right to sue the moneylenders for the stolen properties, because he had not been a director of the company at the time.
The judge probably thinks that a company director who hasn’t realised for two years that his wife has removed his name and started flogging the properties isn’t a director in any meaningful sense, and that the position was a fudge from the beginning.
Since I started working on this story a number of foreigners have contacted me to tell me about their experience of different kinds of fraud on Phuket.
Colin Vard also invested about £1m in Phuket, after a successful career in Dublin as an author and part-owner of a clothing factory. He lost a total of eight properties, over a similar time period.
Do go on.
Vard’s Thai partner, the mother of his son, has been sentenced to 17 years in prison for the fraud.
I do believe I see a pattern forming here.
Ian Rance has a new wife now, and they have a young baby girl.
Oh, for fuck’s sake!
Another Thai wife.
His main priority he says is to provide a proper home for the four children, and put them through school. With the boys’ mother in prison, and his funds exhausted, this is a huge challenge. He cannot even consider returning to the UK, because of the requirements regarding income and savings, which in his case are now insufficient.
Yes, money was so tight and my situation so desperate that I took another Thai wife and had another kid.
“Don’t. Don’t come here. The system of law is nowhere near as strong as you think it is going to be, there is no protection for you, and there are gangs of people victimising you. The lawyers have very little in the way of ethics or professionalism.”
I think what he means to say is “Don’t come here and hand over everything on a plate to a Thai wife.”
Now I may sound a bit harsh here but this Rance chap, and the other one, should have learned the lessons that were spelled out in Stephen Leather’s bestseller Private Dancer, which I have mentioned before. Anybody but the willfully blind ought to know that you are never, ever going to meet a decent Thai girl with western values regarding honesty, integrity, and morality in a bar, shop, or restaurant in Phuket – or anywhere else in Thailand. Difficult though it is to believe, the majority of decent, ordinary Thai girls are not interested in hanging out with fat, ageing, expats who do nothing but drink all day and are effectively long-term sex tourists. Many expats don’t decide to live full-time in Thailand for the weather and lifestyle, they go because of the young(ish) cheap pussy that is on offer in each and every bar you stumble into between 4pm and 3am. I know guys who have genuinely moved out to Thailand for the weather and lifestyle, and they generally do not marry a Thai girl within a year of arrival. Indeed, most of them have their non-Thai wives or girlfriends in tow with them.
It is perfectly possible to own a property in Thailand without the involvement of Thais (the hiring of a Thai lawyer to handle the actual purchase notwithstanding), but you are restricted to foreign-freehold condominiums only, i.e. you can’t buy a house and the land underneath it. Once you decide you want to live in a villa and impress your new Thai bride and start firing out kids and live like a king, then you will need the involvement of Thais who you can trust. And although some might be lucky and meet girls in Phuket who can be trusted, a foreigner will have absolutely no way of knowing who is or isn’t trustworthy and must therefore keep very much on his toes in the way of looking out for the odd sign of something slightly unusual – like the wife selling off all his properties over a two year period. Such naivety would not be without consequences in the UK, and so it is also the case in Thailand. The problem is not so much Thailand being corrupt and the authorities incompetent as there being a seemingly never-ending stream of expat men who are blinded by the availability of young, foreign pussy over whom they wield (temporary) financial power to the exclusion of everything else, including basic common sense. Little wonder the police don’t take much interest in their plight.