Business owners filed a complaint at Bayintnaung Rice Market on 5 January alleging a rice exporter known as U Aung Swe Oo from ASO Company Ltd. swindled more than Ks5.3 billion from 62 merchants and fled.
The amount includes transactions made as of 2 p.m. yesterday, with the final tally incomplete as there are more complaints expected, said Myanmar Rice & Paddy Merchants Association Chairman U Aung Than Oo.
He said there were those who were swindled a minimum of Ks10 million to a maximum of Ks800 million, including one foreign company. A month’s salary still needs to be paid to ASO Company staff who filed a complaint to the market. Officials from the market have resolved this by paying half of the salary due, it was learnt.
The alleged fraudster U Aung Swe Oo had previously traded in beans and sugar. Merchants said he has been in the rice trade for about a year and half and is not a member of the rice market.
“He is not a member. As a non-member could not trade, he used his brother’s membership card. He also used brokers. Some merchants used brokers to trade with him. He came to the market for a short time only. The main thing is the trade is made with the consent of the buyers and sellers. Some merchants sold (to him) because they wanted a better price than the market price. We warned the merchants repeatedly about this,” said U Aung Than Oo.
After similar cases occurred in in the Bayintnaung market, the Myanmar Rice & Paddy Merchants Association and Market Committees issued warnings and alerts to buyers and sellers since September 2017 to be sure that sales in the market are systematic and of true quality, added U Aung Than Oo.
At the present moment, about five businesses have opened cases against U Aung Swe Oo, while the Bayintnaung market is collecting evidence for others who were swindled, it is learnt.
Officials from the Myanmar Rice & Paddy Merchants Association and market formed a committee to provide legal assistance to those who were swindled, a committee to confiscate ASO Company-owned capital items and an arbitration committee between rice mills and rural merchants who dealt with ASO Company so that effective legal actions could be taken.
The whereabouts of U Aung Swe Oo is currently unknown and it is suspected that he is on the run, officials said. Rice bags and related accessories that he stored in rented warehouses have been confiscated, while four plots of lands he owns in Mandalay were prevented from being sold or transferred, it is learnt.
To prevent similar occurrences, assessment of the membership rules will be made within three months, to export only when rice is in hand and not to do pre-sales and pre-purchasing. The government is also requested to allow applications and issue export licenses only when the export products are in hand.
“Mill owners in the region and merchants use brokers. Brokers sell to retail shops, buyers in the regions and rice exporters. When things go wrong, brokers will be the first to be hurt. From them, it will move on to mill owners and merchants and finally the farmers. It is unlikely that this will affect the last stage (farmers)” said the Bayintnaung Rice Market Association Chairman U Lu Maw Myint Maung.
Due to this case, there could be delays in the shipping date if the goods are not provided in time, which could in turn affect the country’s image in foreign markets, added U Lu Maw Myint Maung.
“The (Bayintnaung) market set the base price, and we sell it at that price to the buyer. We are now afraid of these credit sales. I’m afraid nothing will come out of this and the legal costs are high too. I want the (Bayintnaung rice) market to take the lead in making a legal case”, said U Tin Sein of Danuphyu, who said he was swindled out of more than Ks60 million.
At the moment, Myanmar is practicing a market-based system, as the base price is determined by supply and demand. In past years, there had been several cases resulting in the loss of billions of kyats.
By May Thet Hnin