Noodle stall franchises alleged swindling

Officers from the Department of Special Investigation (DSI) yesterday searched the offices of Siam Foods Franchise Co that runs Kuay Tiew Bangkok noodle stalls chain, while the number of franchisees filing complaints against the firm reached 500.

The Bangkok Post
December 8, 2007

Noodle stall franchises alleged swindling
DSI searches franchiser's office for evidence

Officers from the Department of Special Investigation (DSI) yesterday searched the offices of Siam Foods Franchise Co that runs Kuay Tiew Bangkok noodle stalls chain, while the number of franchisees filing complaints against the firm reached 500.

A group of 30 franchisees also lodged a petition at Government House yesterday, asking Prime Minister Surayud Chulanont to speed up legal action against the company's executives.

At the firm's office in Bangkok's Wang Thonglang district, DSI officers with a search warrant found only a list of 1,000 franchisees' names, said Piyawat Kingket, chief of the DSI's unit investigating special criminal cases.

The DSI search team yesterday asked Thanongsak Bunkhrob, a company director who had turned himself in to answer DSI questions, to unlock the office and let the search team into the premises.

Col Piyawat said executives of Siam Foods Franchise moved computers out of the office last weekend upon learning that the number of people filing complaint against them had kept on rising.

Apart from Mr Thanongsak, another company director, Col Choopong Pinthong, contacted the DSI saying he would turn himself in yesterday afternoon.

Two other directors facing arrest who are still at large are Sermsak Unnoi and Watcharaporn Uthai. All the directors are facing charges of swindling and violating the money borrowing act.

According to Col Piyawat, until yesterday morning, the number of franchisees who had lodged complaints with the DSI had risen to 500. The investigation team had until yesterday questioned about 200 of them.

In the meantime, around 30 franchisees led by Suwich Lordrat lodged their petition with the complaint reception centre at Government House.

In their petition, they asked the prime minister to speed up the investigation into the case, arrest all company directors and immediately freeze their assets.

According to the petition, the alleged swindling scam affected some 1,000 people, causing them financial damage of about 400 million baht altogether.

The firm offered its franchisees two franchise systems. In the first, the firm promised to pay each franchisee a minimum of 7,500 baht a month for 10 months for a start-up investment of 35,000 baht.

In the second, the company would pay 10,000 baht a month for 10 months for a 45,000 baht initial investment.

But on Dec 3 the company ceased operations without paying its promised monthly dividend or informing its franchisees in advance, the petition says.

A franchisee who identified himself only as Bo said he petitioned the prime minister because he wanted to keep the case in the spotlight and prevent the firm's executives from fleeing the country.

Mr Bo said he had invested 5.49 million baht in the firm since March this year. As the firm had earlier kept its promise by paying dividend on time and actually operating its noodle stall business, he had kept on increasing his investment.


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Risks: Outright scam, Franchisee revolt, Thailand, 20071208 Noodle stall

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