The chairman of Thailand's Securities and Exchange Commission has resigned after being caught up in an insider trading investigation.
The board formally accepted Vijit Supinit's resignation on Friday, after he came under increasing pressure to leave, culminating in 300 SEC staff arriving at work on Thursday wearing black to mourn the reputation of the agency.
Mr. Vijit, 69, had become embroiled in a murky shareholder attempt to drive management changes at Thoresen Thai Agencies, Thailand's largest dry-bulk carrier, which has a market capitalisation of Baht 15.2bn ($500-million).
He has denied any wrongdoing, but has not made any public statements regarding his resignation and the Financial Times was unable to reach him for comment on Friday.
Mr. Vijit, a controversial former governor of the Bank of Thailand and head of the Bangkok stock exchange, met Chandchutha Chandratat, the head of TTA, two weeks ago apparently as part of an attempt to restructure the company's board.
Mr. Chandchutha says Mr. Vijit approached him saying that he represented a group of investors who controlled 30 per cent of the company's listed stock who were demanding the company call an extraordinary general meeting to replace a number of directors and senior executives.
Bee Taechaubol, one of the shareholders involved in the move, told journalists on Thursday that Mr. Vijit had no financial stake in the change.
"Vijit just played an intermediary role," Mr. Bee said. "He did the right thing as an intermediary, to protect minor shareholders."
Mr. Vijit's role as SEC chairman started to look untenable after Korn Chatikavanij, the finance minister, called an investigation into the dispute, pointing out that under Thai securities law, beneficial shareholdings of more than 5 per cent have to be registered with the SEC and shareholdings of 25 per cent or more trigger a formal bid.
"This reflects the erosion in moral values. It's hard to understand how something like this could have happened," Mr. Korn said.
The markets took the events in their stride, with the SET index falling just 1.6 per cent in the past two days, in line with other regional indices. Foreign brokers said that the change at the top of the SEC had caused barely a ripple among foreign investors, who had low expectations of Thai governance standards.
The SEC is also investigating 75 TTA shareholders for potential insider trading, although it is unclear whether Mr Vijit is among them, and illegal nominee shareholdings.
Mr. Vijit, who was due to step down on July 13, has been involved in controversy before. He resigned the governorship of the Bank of Thailand after coming under fire for the bank's oversight of the Bangkok Bank of Commerce, which collapsed in 1996 after executives embezzled billions of baht and extended numerous unsecured loans.
Mr. Vijit was cleared of any wrongdoing and in 2003 became the head of the Stock Exchange of Thailand, a post he held until 2007.