Summons for Being a Nominee : How to Explain to the Economic Crime Suppression Division (ECD)?

The term “Nominee” is often mentioned in economic crime cases, especially regarding foreign investment and business operations. Many may mistakenly think it is just a normal business arrangement, but in fact, acting as a nominee can be considered illegal under Thai law. If investigated, it may lead to a summons from the Economic Crime Suppression Division (ECD). Understanding its meaning and knowing your rights in giving explanations is therefore essential.

What is a Nominee?

A nominee means allowing one’s name to be used in a business or transaction on behalf of someone else, without being the real investor or decision-maker. Common examples include:

• A Thai person holding shares on behalf of a foreigner to meet Thai legal requirements.
• Opening a bank account under a Thai person’s name but used by a foreigner.
• Holding land in the name of a Thai person for a foreigner’s benefit.

Even if done without bad intent, Thai law treats this as potentially violating the Foreign Business Act B.E. 2542 (1999) or related laws, with penalties of both imprisonment and fines.

Why the Summons from the ECD?

The ECD investigates complex financial and economic crimes. A nominee summons often arises when officials find signs such as:

1. Thais holding shares on behalf of foreigners.
2. Suspicious financial flows, e.g., large unclear transactions.
3. Abnormal company structures inconsistent with actual business.
4. Complaints or links to “grey businesses.”

When such signs exist, the ECD will issue a summons for clarification. Ignoring the summons can lead to more serious legal consequences.

How to Prepare Before Explaining?

If you receive a nominee summons, do not panic or ignore it. Instead, you should:

• Review the summons details – who filed, reasons, and meeting schedule.
• Gather documents – company documents, joint venture contracts, lease agreements, financial records.
• Reassess your actual role – whether you were genuinely involved or just lending your name.

How to Explain to the ECD?

On the day of meeting the officers, you should:

1. Stick to facts – Do not exaggerate or conceal information.
2. Support with documents – Written contracts, financial statements, or minutes of meetings can help prove good faith.
3. Avoid vague statements – Ambiguous answers may be interpreted as tax evasion or law avoidance.
4. Have a lawyer assist – A lawyer can communicate legally, making explanations clearer and stronger.

Risks of Inadequate Explanation

Even without bad intent, incomplete or unclear explanations may be interpreted as acting as a nominee. Consequences include:

• Criminal charges.
• Heavy fines.
• Revocation of business or land ownership rights.

Thus, proper and complete explanation is the key to resolving the matter during investigation without going to court.

Key Legal Advice

The first step when receiving a nominee summons should be consulting a lawyer because:

• A lawyer can assess whether your actions fall under nominee rules.
• A lawyer can draft explanations that align with the law.
• A lawyer can represent you before authorities and reduce pressure.

Being a nominee is no small matter. If you receive a summons from the Crime Suppression Division, you must have a lawyer to advise you.

Being summoned as a nominee by the ECD is not trivial. An unclear explanation may lead to severe legal consequences. But with knowledge of your rights, proper documentation, and legal representation, the case can often end at the investigation stage. Since such cases involve economic, criminal, and tax law, having a lawyer is your best safeguard to present explanations that are logical, solid, and legally correct.

👉 If you or someone close to you has received a nominee summons, consulting a lawyer immediately is the safest first step.