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September 5, 1998


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The Rediff Business Special

The NRI fugitive

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Maybe he takes his first name seriously. He rakes in the moolah. Millions of dollars -- allegedly out of banks, countries, continents. Just like that. Rakesh Saxena, 46, financial whiz. If only somebody had told Thailand's Bangkok Bank of Commerce that since it shares the Beeb's famous initials, it could as well share its motto -- Be Bloody Careful -- the global markets may have been well off today.

A sense of pride might fill Saxena on realising that he, an Indian by birth, had a bearing on the current global economic chaos. You could be talking of an older, smarter, healthier Nick Leeson.

Saxena was born in India, worked in Hong Kong, had designs on diamond and mineral mines in Sierra Leone, has bank accounts in Switzerland, owns companies in the Cayman Islands and Virgin Islands, is wanted in Thailand, and is at present in Canada.

His adventure began in 1985, perhaps much before that, when he set sail from India for Hong Kong. He travels, but his story does not, from beginning to end -- it goes on. And on.

Yesterday, the Thailand attorney general's office asked authorities in 22 countries to freeze $ 300 million in accounts belonging to the fugitive.

Saxena, a former advisor to the now defunct BBC of Thailand, is currently detained in a Canadian prison though some reports say he has been allowed to fight his extradition case from his condominium.

In British Columbia's supreme court, he faces extradition to stand trial in Thailand on embezzlement charges. Thailand's charge is that Saxena, BBC's then president Krirk-kiat Jalichandra, their associates, a few Thai politicians and Saudi arms merchant Adnan Khashoggi embezzled as much as $ 2.2 billion from the bank.

According to the Thai authorities, Saxena himself transferred more than $ 300 million out of the BBC to bank accounts in 22 countries during 1992 and 1996.

Switzerland, acting on a Thai request, has frozen $ 40 million deposited by Saxena in Swiss banks. Thailand is seeking to freeze other accounts opened in Russia, China, the United States, Canada, Australia, England, Italy and some East European countries. Thailand has traced and frozen bank accounts around the globe containing perhaps as much as $ 135 million.

Evidently, the kingdom is still smarting from the scandal that caused BBC's collapse in 1996, eroded confidence in the Thai financial system, forced the central bank chief's exit and finally brought the government down. All this weakened the Thai currency, the baht, leading to its devaluation that sparked the regional meltdown. The downturn continues.

But Saxena is not in a mood to return to Thailand. "I am afraid with good reason that I will be killed extra-judicially should I set foot in Thailand," he told the British Columbia court.

The fear of death seems natural for the man whose reported zest for life has been well-documented. People may call him Kermit because ''he looks like a Muppet frog'', but he owns a sprawling $ 500,000 apartment building at Vancouver's picturesque Yacht Harbour Point. Before he was detained in Canada, he was protected by bodyguards and bullet-proof gismos; his security cost him $ 27,000 a month.

He is known to have complained against the lowly conditions at the remand centre in Canada, where he was detained for months after his arrest, following criminal charges and an extradition request by Thailand.

How he pursued his passion for life in the fast lane, makes for fascinating reading, even in these scandalous times.

Born in Indore in central India on July 13, 1952, Saxena completed his education in 1974, arming himself with a Master's in English and prestigious labels of St Columbia's school and St Stephen's college in Delhi. His mother is a respected scholar at the Commonwealth secretariat in London.

He chose not to become a poet or writer, but dabbled in stocks and foreign exchange for five years, first in Kochi in south India, then in Delhi. He worked for the Oriental Bank of Commerce in Delhi that almost collapsed once, when Saxena overtraded in the pound. The bank's average monthly trading turnover was $ 5 million: Saxena had the zeal to handle $ 50 million a day! That was enough to stir the Indian government into nationalising the OBC.

His aptitude for digits and finance earned him a flashy lifestyle and access to the powers that be. But more colourful pastures beckoned. Leaving his wife and daughter behind, he shifted base to Hong Kong.

There he met a Thai, Suwanna Hanvorakiat, an insurance company employee, who would become his second wife. (She now lives in Thailand with their three kids). He worked for a year as a foreign exchange dealer at DSP Finance; then joined Wocom Commodities. His overspending, overdrafting ways continued, as the Bank of Credit and Commerce International realised much to its chagrin. BCCI slapped a court notice for HK $ 30,000. Saxena never paid up. It meant only one thing for him: move.

Moved he did, in 1985. To Bangkok.

It was boom time. Thailand's economy was on song. Ordinary companies would be bought as though they were gold. After some dressing up of books and downsizing, they would be resold for smart profits. Similar techniques were applied in the real estate market where property would be overvalued.

For the likes of Saxena, money was there for the taking. He decided to take it, make it. Godspeed. He did everything that needed to be done: buy and sell companies, property, etc.

That's not all. He decided to combine his Master's in English and his vast knowledge of high finance. The idea germinated into a hugely popular financial column in the Bangkok Post. He never chased anything, but the effort got him name, fame, respectability, and entry into high society. His ascent did not unnerve him.

Seminars on forex and hedge tools followed. He enthralled brokers, business bigwigs, financiers, officials, anybody who was a somebody, with his expertise and understanding of market issues. Over the years, he had learnt to socialise well.

At about that time in 1986, a mini-crisis hit the Thai banking sector, prompting the central bank to recruit old hands to stage a rescue act for battered banks. Enter Krirk-kiat of the Indraduta banking clan, BBC's main shareholder.

His mandate was to shore up BBC suffering from bad loans. He moved in as senior vice-president and soon rose to director and president. It was only a matter of time before he would come under Saxena's spell.

Krirk-kiat was the big exec. Saxena his influential advisor. Major -- and fateful -- decisions were team efforts, so to say.

BBC's was not a particularly attractive name in the Thai banking sector; but the punters liked it as the Indraduta clan did not seem to mind that its shares, far in excess of safe levels, were available in the market. BBC, in that sense, was was up for grabs, should any calculating businessman make a move.

And Song Watcharasriroj (aka Sia Song) made the move. Why? Mystery shrouds the motives. Analysts say it was a dubious decision to create an artificial demand for BBC shares. Others doubted if Song intended to slip into BBC's helm. Song himself said he would increase BBC funds by using them to play the market.

Song's stories never cut much ice with the Thai central bank and the government. Krirk-kiat knew this, and tried to win over government support to stave off Song's onslaught. As his attention wavered, BBC weakened further. Saxena, then, found it that much more easier to sell his high-risk schemes to Krirk-kiat.

Not only that. During 1993 and 1994, the team sought to take over as many as 15 public companies in Thailand, including Phoenix Pulp and Paper, cooking oil major Morakot Industries, Semiconductor Venture International and Jalaprathan Cement.

But BBC remained mired in trouble. Krirk-kiat increasingly relied on Saxena, without much success, though.

Monday: The Saxena Saga continues


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