The first clear wrongdoing involved creating fake sales and fraudulent accounts receivable. STARK fabricated sales reports, but since there were no actual end-buyers, the company had to invent account receivables and the corresponding debt. The total fake debt amounted to 6,025 million baht.
The second case of fraudulent sales involved real recorded transactions, but the buyers were allied companies, and no actual products were delivered. The manipulated figures in this scheme totaled 1,890 million baht, paid by Asia Pacific Drilling Engineering Company (APDE), a company connected to one of STARK’s major shareholders, and Thai Cable International Company Limited.
To further conceal these fraudulent activities, STARK made a 611-million-baht Value Added Tax (VAT) payment to the Revenue Department. This was intended to disguise the fake sales as legitimate transactions and avoid detection.
Another scheme involved making advance payments to suppliers, but instead of going to the intended recipients, the funds were redirected to APDE. The company attempted to make the transaction appear legitimate, but in reality, 10,451 million baht ended up with APDE rather than the actual suppliers.
Beyond these fraudulent activities, STARK also concealed fake accounts receivable through offshore payments. The company tried to reduce the recorded debt of its nonexistent customers by making payments that were claimed to come from offshore sources. However, investigations revealed that the 6,086 million baht in offshore money actually came from APDE. Essentially, APDE used the funds it had previously received from STARK for fake product transactions to eliminate debts from fraudulent accounts receivable.
After a special audit, STARK reported a total net loss of over 12 billion baht in just two years, while its owner’s equity plummeted to negative 4,400 million baht.
