The crown prince of Thailand’s third marriage unraveled in lurid headlines: The princess was stripped of her titles, her parents and brothers jailed over vague corruption allegations, her uncle purged from his senior police post.
Then the heir to the throne had to finesse a divorce settlement.
Luckily for the prince, he had access to one of the largest royal fortunes in the world, a secretive holding company laden with stakes in blue-chip Thai companies and prime land in the heart of Bangkok. The company covered the payment, reportedly close to $6 million.
Two years later, in 2016, the prince ascended to the throne. One of King Maha Vajiralongkorn’s first major acts was to transfer all the holdings in the vast company, known as the Crown Property Bureau, to his personal ownership, giving him control of more wealth than the reported riches of the Saudi king, the sultan of Brunei and the British royal family combined.
Those assets — conservatively valued at $70 billion — are now a focus of a pro-democracy movement clamoring for greater transparency into the monarchy’s finances and limits on its extensive powers.
Tens of thousands rallied in Bangkok on Thursday evening, ignoring a government ban on protests and chanting for the release of about 40 activists arrested in the last week. A day earlier, some protesters heckled a motorcade carrying the queen during a rare public appearance in the capital by the ruling couple, who live in Europe.
The mostly peaceful demonstrations began this summer. In August, students at Thammasat University demanded the king restore the assets to Crown Property Bureau control and place it under government oversight — a startling act of defiancein a country where a strict royal insult law has traditionally silenced criticism of the monarchy.
Some protesters have also called for a boycott of Siam Commercial Bank, in which the king holds a nearly 24% stake. Fears of a run on deposits prompted a director of Thailand’s central bank to reassure investors that there was sufficient liquidity in the country’s financial institutions.
“When the protesters talk about the monarchy as an institution, the CPB is at the core,” said Pongkwan Sawasdipakdi, a lecturer at Thammasat and a doctoral candidate in international relations at USC. “One of the top things that people think about is how can the monarchy accumulate such really high wealth and we don’t really know anything about it.”
Questions over spending by an aloof monarch, whose expensive lifestyle stands in contrast to stories of his thrifty father, have emerged as Thailand’s economy reels from the COVID-19 pandemic, which followed years of tepid growth under a military-led government closely tied to the ruling family.
Opposition politicians led by lawmaker Thanathorn Juangroongruangkit have also challenged an additional $1 billion in public funds earmarked for the monarchy in the 2020 budget — including security, travel, ceremonies and “special activities” — while the economy is projected to shrink by 8%.
Tens of thousands of peaceful demonstrators have gathered in rallies since early summer, a remarkable political reawakening in a country that abolished the absolute monarchy in favor of a parliamentary system in 1932 but has steadily drifted away from democratic rule. The army, with royal support, has toppled a succession of civilian governments and now controls the parliament and nearly every state institution.
The military, in turn, fell in line when the king took over the Crown Property Bureau, whose enormous interests “enter into almost every significant area of Thai economic life,” Porphant Ouyyanont, a late Thai academic who was the leading authority on the bureau, wrote in a 2015 paper.
Created in 1936 to manage the crown’s institutional assets and cover some of its expenses, the bureau operates in a legal netherworld — neither a government agency nor a private institution, nor part of the palace — and in near-total secrecy from inside a butterscotch-yellow Italianate villa in Bangkok’s leafy royal district.
Its board of directors, handpicked by the king, doesn’t release financial statements. Much of its holdings, especially in land, remain a mystery. But the estimated portfolio makes him the world’s richest monarch, a man who owns lakeside villas outside Munich, Germany, and rents out a hotel in the Bavarian Alps.
The bureau’s biggest corporate investments — in Siam Commercial Bank and Siam Cement Group, an industrial conglomerate in which it holds a 34% stake — were together worth about $8 billion at the end of last year, according to the companies’ annual reports. Although the bank’s shares have lost half their value during the pandemic, dividends from the two publicly traded companies generated $342 million in income for the king in 2019.
Its landholdings — including 5½ square miles spread across high-rent districts of central Bangkok — were estimated by Porphant to be worth $32 billion in 2015, but little is leased for commercial use.
Scrutiny of these assets was long seen as unnecessary because the monarchy and its holdings had “proved themselves to be of no financial burden to the country,” Porphant wrote. The current ruler’s father, King Bhumibol Adulyadej, who reigned for 70 years, was portrayed in royalist propaganda as so frugal that he never wasted a dab of toothpaste — even as Thailand grew into an economic engine of Southeast Asia and the crown’s investments multiplied in value.
King Vajiralongkorn is a different figure.
Educated at boarding school in Britain and a military academy in Australia, the 68-year-old monarch is married to his fourth wife and spends almost all his time in Germany, often in the company of a girlfriend known as the “royal consort” and a retinue of attendants and security. Even from that distance he has taken a more assertive role in Thai politics, brought two military units under his command and changed the law to allow himself to reign from abroad.
In July 2017, nine months after he assumed the throne, a law passed by the military-dominated parliament placed the Crown Property Bureau’s assets “under His Majesty’s discretion,” ending the previous arrangement under which the monarch could spend the bureau’s income at will but left buying and selling decisions to the board of directors.
The king removed the finance minister and the bureau’s long-standing director-general from the board and installed his private secretary, a 69-year-old with no finance or economics background, as chairman and several other loyalists as members.
“The assumption must be that the monarch is now the principal decision-maker,” said Tom Felix Joehnk, a Bangkok-based writer and economist.
The assets are now subject to taxes for the first time, but little else about the portfolio has changed. Vajiralongkorn has retained the corporate shareholdings and generally continued its conservative approach to land.
The plots include some of the most sought-after neighborhoods in the capital, along the Chao Phraya River and in the commercial districts of Silom and Sukhumvit. But Porphant found that 93% of the land generated little to no income, rented at “much lower than market rates” to slum communities, state agencies, schools, foundations and others with special relationships to the crown.
The last category includes the U.S. government, which for decades has rented the ambassador’s residence — a stately, blue-shuttered mansion surrounded by lawns — for just “a few hundred dollars” a month, Joehnk said.
Critics say the opaque system allows the king to treat land deals as political favors, at odds with demonstrators’ goal of a modern constitutional monarchy. In a 2011 interview with author Serhat Unaldi, former director Chirayu Isarangkun na Ayuthaya said the bureau considered “social benefits … not only financial values” when developing land for commercial use.
Still, the bureau has sought to extract more money from its land since the 1997 Asian financial crisis temporarily wiped out its income.
Newer tenants include Bangkok’s top shopping malls and luxury hotels. In 2017 it signed over several adjoining plots to build Thailand’s biggest private development, a $3.6-billion complex of hotels, condos and a mall on what had been a boxing stadium and night market.
In 2018 the capital’s much loved zoosuddenly announced it was moving from crown-owned land opposite the former king’s residence to a new site in a northern suburb. Other properties in the area have also been retaken by the crown, fueling speculation that Vajiralongkorn might build Bangkok’s first new royal palace in more than a century.
“There is a fair amount of land being developed, but it is not clear to me that there is a shift in the investment strategy,” Joehnk said. “The development of royal land for royal purposes [would be] new, though.”
Those seeking answers from the bureau, which didn’t respond to an interview request, would be disappointed. It hasn’t published an annual report since 2016. Parts of its website pull up empty pages; most of the English-language site is “under construction.”
“The status of the organization is clear now, whereas it wasn’t so clear before,” said Kevin Hewison, an emeritus professor of Asian studies at the University of North Carolina at Chapel Hill. “It was in a legal nether land and it’s not now. It’s the king’s own personal property. But there’s much less information about it.”