The Securities and Exchange Commission (SEC) of Thailand has filed criminal complaints with the Department of Special Investigation (DSI) against three parties: 1) JKN Global Group Public Company Limited (SET: JKN), 2) CEO Jakkaphong “Anne” Jakrajutatip, and 3) Pimauma Jakrajutatip.
The charges allege that these parties collectively engaged in, consented to, or allowed the inclusion of false information and/or incomplete, inaccurate, and untruthful accounting records in JKN’s 2023 annual financial statements and the 1Q24 financial documents.
The SEC asserts this was done to deceive stakeholders by submitting or disclosing false financial statements for 2023 and the “Form 56-1 One Report” containing misstated financial data.
According to the report, JKN’s auditor acted pursuant to Section 89/25 of the Securities and Exchange Act B.E. 2535 (1992), notifying the Audit Committee regarding several questionable content acquisition transactions.
These included: repurchasing rights in 2024 that overlapped with existing, unexpired content rights; acquiring substantial additional content despite liquidity constraints; transactions that may never have occurred; incomplete accounting documentation; and purchase orders for content rights that were inconsistent with information received by the auditor during the audit process. As a result, the auditor was unable to express an opinion on both JKN’s consolidated and separate company financial statements for 2023.
The SEC’s review of JKN’s annual financial statements from 2020 to 2023 found that the company’s licensing assets saw a significant increase, which did not match revenue from content sales. Additionally, trade receivables at year-end were either near or exceeded reported licensing income, suggesting that JKN was largely unable to collect these receivables, or collected only minimal amounts.
Therefore there are concerns about the rationale behind these content acquisitions, the actual existence of the acquired rights, and both the legitimacy and existence of clients recorded as trade debtors to whom these rights were allegedly sold.
It was found that two individuals—Jakkaphong Jakrajutatip (Managing Director and CEO) and Pimauma Jakrajutatip (Director and Deputy Managing Director, Content Division)—collectively ordered or facilitated the creation of fictitious creditors and debtors. These actions were made to falsify financial statements for 2023, as well as the first-quarter 2024 accounting documents and other relevant reports.
This resulted in JKN’s financial statements showing inflated revenues and liabilities. Furthermore, licensing creditor entries were not recorded according to the periods in which they actually arose, leading to understatements of both liabilities and assets in the 2024 financial statements.
Meanwhile, trade receivables were rolled into 2024 records, misleading stakeholders into believing there was a surge in trade receivables in that year. These manipulated creditors’ voting rights were then used to influence the selection of JKN’s business rehabilitation plan administrator—a violation of Section 312 of the Securities and Exchange Act.
Additionally, Jakkaphong, on behalf of JKN, submitted or disclosed the 2023 annual financial statements and the Form 56-1, both containing false information, to the SEC, which constitutes a breach of Section 281/10 of the Securities and Exchange Act.
As a result of these charges, the implicated individuals are deemed unfit and untrustworthy to hold positions as directors or executives of listed companies or entities issuing securities, for the duration of the case, effective from the date the SEC filed the complaint with the DSI.
Furthermore, the SEC is extending its investigation to other areas of concern in coordination with the DSI, and any additional findings will be disclosed as they become available.
