Plight of the elderly Danish businessman is a salutary lesson on what can go wrong in Thailand when the dream turns overnight or even in an instant, into a tormenting ordeal with no end in sight.
A 65-year-old Dane, a former hotel owner from Ko Phangan, is living the ultimate Thai nightmare after being released from an Immigration Bureau detention centre on Tuesday following nearly two months inside. However, on the 21st of December, the European national, left nearly destitute after the failure of his business in 2020, faces the prospect of a prison sentence of two and a half years being confirmed by the Court of Appeal in Samui.
A Danish businessman and his family find themselves caught up in an extended ordeal in Thailand after the foreigner and his Thai wife were found guilty by a court in Ko Samui of forgery linked to an effort to firefight and save a valuable business, a hotel resort on Ko Phangan.
The couple were sentenced to two and a half years in prison after a financial deal to compensate the British complainant in a criminal case filed with police fell through due to complications which arose due to the Dane’s immigration status.
Stig Wulff claims he is innocent of the charge but has already been convicted and sentenced. The court found he forged his British partner’s signature
65-year-old Stig Wulff claims he is innocent of the charge and was only trying to ensure the survival of a company which operated the Ko Phangan hotel after it faced a hefty tax demand from the Revenue Department and later had to deal with the impact of the pandemic shutdown.
His British partner in the enterprise, filed a complaint with police after the hotel resort was seized by a private lender claiming that his shares in the firm were illegally transferred through forgery perpetrated by the Danish national.
Subsequently, he claimed that he had never signed any documents to the effect of transferring his shares to Mr Wulff’s Thai wife in advance of complex negotiations to secure a loan to stave off the loss of the valuable hotel resort and subsequent re-financing to secure its survival.
Arrived in Thailand in 2009, married his Thai wife in 2013 and owned a hotel but a Revenue Department bill turned the couple’s lives upside down
Mr Wulff arrived in Thailand in 2009 and thereafter set up a company on Ko Phangan to manage a resort, the Suan Sawan Ocean View.
Like many Thai private companies involving foreigners, it had foreign directors with voting shares and minority Thai shareholders. Mr Wulff married his Thai wife in 2013 and all was going well until the company was served with a Revenue Department demand for ฿1.5 million in respect of undeclared taxes.
This happened after a review of the company’s operations by the Revenue, which queried the taxes to be paid by the firm.
Mr Wulff and his wife went about trying to obtain a loan from the company’s bankers Kasikorn Bank (KBank) but were turned down. It is believed one of the reasons for this was the foreign ownership of the company that operated the resort.
Subsequently, the valuable resort was seized by the Revenue Department but in a last-ditch effort to save the business, Mr Wulff and his wife were able to negotiate a private loan, a common practice in Thai business involving security and signed papers against the title deed of the property in conjunction with the local Land Registry office.
Company that owned the Ko Phangan hotel had to have Thai shareholders only as a condition for a loan to pay the tax bill and later for working capital
However, a condition of this was that the shareholdings in the company would be held by Thai nationals.
To achieve this, Mr Wulff himself transferred his shares to his Thai wife and he claims to have secured the approval of his British partner or fellow shareholder to transfer his shares due to the urgency of the situation
To effect this, he signed the requisite documents on behalf of the British national. This was later the basis for the UK man’s claims to the police on Ko Samui.
Afterwards, having successfully secured the loan and paid the Revenue Department, Mr Wulff and his wife had the property and resort transferred back into the ownership of the company only to have the pandemic crisis strike in 2020 which effectively shut Thailand for several years with the foreign tourism business only returning to normal at the beginning of 2023.
The loss of the foreign tourism trade and virtually no turnover made it impossible for Mr Wulff to make the required payments under the, by then, extended private loan agreement.
Private loans based on collateral are common in Thailand among small business operators but if the loan conditions are breached, the property is lost
Under such agreements, which are quite common in Thailand and governed by the law, the asset collateral is transferred to the ownership of the lender if the required interest payments are not made on time or if certain conditions, related to either the principal and interest payments, are not met.
This is what happened and the firm lost the ownership of the resort and hotel on Ko Phangan.
Mr Wulff claimed his British partner was advised of the company’s difficulties at all times and refused to advance any further capital, to deal with the situation
Not long after, in 2020, the British partner shareholder filed a criminal lawsuit against the Danish entrepreneur and his wife, accusing them of falsely forging his signature on the share transfer documents and claiming to not know about the transfer of the shares.
The man sought ฿34 million in damages as a result of the loss of his shareholding in the company which led to a court hearing before Ko Samui Provincial Court in which the Dane failed to provide enough evidence to justify his claim that the transfer of his British partner’s shares was by mutual consent.
Ko Samui Court handed down judgment against Mr Wulff but allowed him to pay compensation instead of going to prison, it didn’t work out for the Dane
The Thai court upheld the complainant’s claim but, on listening to arguments from his lawyers, provided an alternative settlement as opposed to a prison sentence for committing what is a serious criminal act in Thailand.
It proposed that Mr Wulff pay the amount of ฿17 million or $485,714 and made an instalment order against the Dane for ฿200,000 a month.
Mr Wulff explained that he agreed to the settlement on the basis that he was able to find a job with a friend in Austria and would be able to make the hefty monthly repayments required.
This then led to a further complication and problem for the Danish national as he was detained at Suvarnabhumi Airport by Immigration Bureau officers when attempting to fly out to Austria to take up the position.
Austrian job fell through when the Dane’s immigration status and lapsed visa became a problem leading to jail time and another intractable legal mess
The Dane was directed back to the Immigration Bureau on Ko Samui to address his visa status and overstay in the kingdom.
However, this led to his job in Austria falling through and when he failed to make the first instalment in respect of the agreement on the hotel with his British partner of ฿200,000, the British man complained to the court which acted immediately and sentenced Mr Wulff and his Thai wife to two and a half years imprisonment.
At length, through his lawyer, he appealed the decision to the Court of Appeal and secured his temporary release on bail.
Afterwards, Mr Wulff and his then five-year-old daughter moved from Ko Phangan to Nakhon Ratchasima, in northeastern Thailand, the home of his wife’s father, while his wife stayed behind taking a job in Ko Phangan.
Unfortunately, here, he also ran into difficulties when an anonymous complaint was made to the Immigration Bureau about his visa status.
This led to Mr Wulff’s arrest again and his subsequent detention at Bangkok’s Immigration Detention Centre on Sathorn Road, a notoriously overcrowded institution about which human rights activists and United Nations representatives have documented several deaths among detainees awaiting either deportation or clarification of their visa status.
His story has been highlighted on the respected Scandinavian Asian news website Scand Asia with the support of a committed legal team while a fundraising appeal online was less than successful.
Later, Mr Wulff was moved to another Immigration Bureau facility near the Police Club on Vibhavadi Rangsit Road.
Good news on October 17th, release from Immigration detention at a price of ฿120,000 and his criminal case to be decided on appeal on December 21st next
On October 17th this year, Mr Wulff’s lawyer Mr Suwatchai Sawasdee visited him at this facility and informed him that he would be able to obtain temporary release from the detention centre if he could pay ฿120,000 while also notifying him that the Court of Appeal would hear and resolve this case on the 21st of December 2023, four days before Christmas.
It took one month for Mr Wulff, on Tuesday 21st November, to be released after being held at the facility for nearly two months.
The 65-year-old emerged from his incarceration looking gaunt and appeared to have lost weight from earlier photographs.
Nevertheless, his ordeal is still ongoing as his lawyer has informed him that it is unlikely he will win his appeal on the 21st of December which will leave him and his wife each facing up to serving the prison sentence of two years and six months.
Mr Wulff now claims that he has further evidence supporting his earlier assertion that his British partner had agreed to the transfer of shares to obtain the loans for the company to save the hotel and resort.
Appeal court cannot allow new evidence, Stig’s lawyer doesn’t hold out much hope as to a conviction
However, under Thai law, in the case of an appeal, no new evidence can be introduced beyond the witness evidence and the documentation presented to the judges in the court of first instance.
Despite this, Stig Wulff’s lawyer, Mr Suwatchai, is holding out the hope of a Supreme Court review of the conduct of the case and its resolution. This is a request, in truth, that is unlikely to succeed.
A far more likely hope for the Danish man is that the court will agree to probation given the exceptional circumstances surrounding the complaint against him or the possibility that the sentence will be reduced, again given the mitigating circumstances.
Cautionary tale for those doing business in Thailand
The case highlights the onerous responsibility of any foreigner in Thailand engaging in business and operating a Thai-registered company, particularly as it, by law, is required to have other shareholders and majority Thai ownership.
It highlights the importance of keeping affairs in order and the lack of scope to manoeuvre afforded to foreigners if things go wrong as can happen with any business venture.
It shows that Thailand’s legal system is more strictly interpreted compared to current legal trends in Western countries, with disagreements and infractions of legal agreements often leading to criminal proceedings as opposed to civil cases.
Nevertheless, in any country, applying another’s signature to any contractual agreement or document is bound to lead the person doing so into legal hot water and criminal difficulties.