Thailand cuts high-risk nominee firms by 75% ahead of 21-agency anti-fraud pact

Thailand's government has significantly reduced the number of companies suspected of using Thai nationals as nominee shareholders after tightening registration requirements and investment verification checks, with authorities now preparing to expand enforcement through a formal multi-agency agreement.

The Department of Business Development (DBD) under the Ministry of Commerce reported that the number of high-risk companies fell by 75% between 1 and 23 April 2026, dropping to 175 from 658 in the same period of 2025. The figures follow stricter investment verification measures that took effect on 1 April.

Earlier tightening measures had already produced results. From January to March 2026, the DBD recorded 1,373 high-risk companies, down 60% from 3,511 in the same quarter of 2025, after authorities began requiring additional financial documentation from high-risk applicants from 1 January 2026.

PM's Office spokeswoman Rachada Dhnadirek confirmed on Sunday that the results were part of the government's Quick Big Win policy, which prioritises swift enforcement and early measurable outcomes against practices seen as undermining Thailand's business environment.

Nominee arrangements under the lens

The crackdown targets the misuse of Thai nationals who hold company shares on behalf of foreign investors, a practice used to circumvent restrictions under the Foreign Business Act B.E. 2542 (1999). Authorities say the arrangements have been exploited to facilitate money laundering and other unlawful operations.

DBD Director-General Poonpong Naiyanapakorn said the department had worked alongside partner agencies to screen legal entities with foreign shareholders, conduct field inspections and strengthen pre-registration checks. Five departmental orders and two notifications targeting high-risk groups have been introduced as part of the effort.

From October 2025 to 23 April 2026, the DBD and its partners conducted prevention and suppression operations across three main areas: investigating nominee networks, conducting field inspections and scrutinising foreign-linked entities for violations of business laws.

Investigations reach more than 300 entities

Eleven cases involving suspected nominee arrangements have been forwarded to the Central Investigation Bureau (CIB) for further investigation. These cases are linked to more than 300 legal entities operating in the steel, accounting and property development, and transport sectors.

Businesses under scrutiny have been identified in Samut Prakan, Surat Thani, Chonburi, Bangkok and surrounding provinces.

Field inspections were carried out at 27 locations across 10 provinces. The sectors inspected included tourism, real estate, logistics and coconut trading warehouses. 

Findings were referred to nine agencies for further investigation and legal action. The Anti-Money Laundering Office (AMLO) received 534 cases for financial trail investigations of Thai shareholders in suspected nominee entities. The Revenue Department received 6,709 cases for account and financial statement audits of high-risk legal entities. The Social Security Office received 137 cases to examine employees of targeted accounting firms. The Economic Crime Suppression Division received 117 cases, comprising 92 accounting firms, 15 coconut trading warehouses and 10 individuals, for investigation under the Foreign Business Act B.E. 2542 (1999). The Department of Special Investigation (DSI) received 25 cases and the Trade Competition Commission 15 cases for further legal action.

Tourism raid exposes nominee operation in Bangkok

On 23 April 2026, the DBD's nominee crackdown team conducted a joint operation with the Department of Tourism, the Tourist Police Bureau and the Department of Employment, raiding a travel company in the Ratchaprarop area of Bangkok following a tip-off about suspected illegal tour operations and nominee conduct.

The company's shareholder structure showed 51% Thai and 49% foreign ownership on paper, with registered capital of B4 million. Authorities noted, however, that the company had recorded revenue of B47 million in 2024.

During the inspection, not a single Thai director or shareholder was found on the premises. Only an Indian director was present, and he was found to be managing all operations, which Poonpong said was a clear indicator of nominee conduct.

Two foreign nationals were discovered working without work permits and were arrested immediately. They were transferred to Phaya Thai Police Station for prosecution under the Foreign Workers Management Royal Decree B.E. 2560 (2017).

The Department of Tourism separately found the company had failed to arrange tourist insurance, in violation of Section 34 of the Tour Business Act. The offence carries a maximum fine of B500,000 and a possible licence suspension of up to six months.

The DBD has issued notices to the company's Thai directors and shareholders requiring them to appear for questioning about the source of their investment to determine whether nominee offences apply.

Thousands of foreign firms face scrutiny

The DBD has also examined 4,372 foreign-linked companies suspected of operating without the required authorisations. Of those, 256 were classified as List One businesses — those that foreigners are strictly prohibited from operating under Thai law. The remaining 4,116 were List Two and List Three businesses, which require prior approval before foreign operators may conduct them.

Authorities said they would continue gathering evidence and pursuing in-depth investigations. The DBD warned that any business found to have violated foreign business operation laws would face strict legal action.

Coconut trade spotlights nominee abuse

The nominee issue has drawn particular attention in the agricultural sector. Division for the Prevention and Suppression of Illegal Businesses director Payungsak Kangseng said officials from the DBD, the Ombudsman's Office and partner agencies were conducting inspections in Ratchaburi and Samut Songkhram provinces.

The inspection targets Chinese-operated wholesale companies suspected of using Thai nationals as nominee shareholders to dominate the buying and export of Nam Hom coconuts. Growers in the two provinces have complained that farm-gate prices have fallen to between 50 satang and 3 baht per fruit, well below the average production cost of 7 baht.

Ombudsman's Office chairman Songsak Saicheua called on the Commerce and Agriculture ministries to coordinate closely to establish a supply chain from production to market, and to tighten controls on the export of agricultural produce by foreign-controlled trading firms.

Growers said a proposal from the Commerce Ministry to sell directly to modern trade outlets had not worked due to a shortage of packaging facilities and limited marketing capacity at the local level. A lack of refrigeration infrastructure to preserve the fruit was also cited as a practical obstacle.

Law reform under consideration

The DBD is also considering amendments to the Foreign Business Act to classify the use of Thai nominee shareholders in a foreign-controlled company as an offence equivalent to money laundering. Payungsak said division officials and relevant agencies were reviewing the proposal, which is intended to raise the legal and financial consequences for nominee arrangements significantly.

The use of nominees extends beyond agriculture. According to authorities, law firms have reportedly arranged for Thai citizens to serve as proxies in businesses operated by foreign nationals, particularly in tourist areas such as Phuket, Ko Samui and Pattaya.

21 agencies to formalise crackdown

Deputy Prime Minister and Commerce Minister Suphajee Suthumpun has instructed the DBD to deepen cooperation with other relevant agencies and advance a serious and coordinated crackdown on nominee businesses.

A memorandum of understanding on cooperation to prevent and suppress the use of Thai nationals as nominees is scheduled to be signed on Wednesday, 29 April 2026, at Santi Maitri Building, Government House, with the Prime Minister presiding over the ceremony.

The agreement will bring together 21 agencies. These include the Ministry of Interior, the Ministry of Digital Economy and Society, the Royal Thai Police, the Anti-Money Laundering Office (AMLO), the Bank of Thailand, the Board of Investment (BOI), the Internal Security Operations Command (ISOC), the DBD, the Revenue Department, the Customs Department, the Department of Special Investigation (DSI), the Department of Lands, the Department of Tourism, the Department of Employment and the Department of Industrial Works.

Other parties to the agreement include the Department of National Parks, Wildlife and Plant Conservation, the Department of Agriculture, the Trade Competition Commission (TCC), the Food and Drug Administration (FDA), the Thai Industrial Standards Institute (TISI) and the Thai Bankers' Association (TBA).

The cooperation agreement is intended to strengthen enforcement, improve inter-agency data sharing and build confidence among both the public and the international business community that legally operating foreign investors will be protected while illegal nominees are pursued.

Foreign investment figures for the first quarter of 2026 suggest the crackdown has not dampened legitimate investor confidence.

The DBD recorded 347 approved foreign business entries between January and March, up 28% from 272 in the same period of 2025, with total investment reaching B97,780 million — more than double the B47,033 million recorded a year earlier.

The United States led by volume with 61 approvals worth B5,903 million, followed by Japan with 55 approvals worth B21,240 million and China with 54 approvals worth B22,042 million. Singapore accounted for 44 approvals worth B18,547 million and Hong Kong for 33 approvals worth B6,950 million.

Investment in the Eastern Economic Corridor (EEC) accounted for B44,001 million, or 45% of total foreign inflows during the quarter, with China the single largest contributor at B19,535 million across 37 investors. 

Rachada said the next phase of enforcement would focus on deeper nominee network investigations, coordinated on-site inspections and a systematic examination of foreign-owned entities suspected of violating Thai laws, while protecting investors operating within legal frameworks.