Daruma Sushi owner cleared of scam charges amid business collapse

The Criminal Court acquitted a 41 year old owner of the Daruma Sushi restaurant chain, of charges related to a coupon and franchise sales scam that allegedly caused hundreds of millions in damage.

The court ruled that the mismanagement leading to the restaurant’s failure was not intentional or fraudulent. The verdict was delivered at 9am, today, February 15, at the Ratchadaphisek Criminal Court, where prosecutors had accused Daruma Sushi Co., Ltd.. and Bonnie Chalingsuk, also known as Mettha, of defrauding the public and money laundering.

Prosecutors charged that between May 18, 2021, and June 18, 2022, the accused engaged in a scheme to sell Japanese buffet coupons through the Daruma Sushi app at prices of 199, 250, 299, and 399 baht. Despite collecting money through the company’s account, they had no intention of running the Japanese restaurant business, leading to 988 victims purchasing coupons.

Additionally, they falsely advertised franchise sales, deceiving 11 individuals into investing 2 to 2.5 million baht (US$69,167) per branch. Prosecutors also accused them of laundering over 150.7 million baht (US$4,169,433), seeking a court order for them to repay or compensate victims a total of 42.3 million baht (US$1,170,675), reported KhaoSod.

At the hearing, the defence lawyer and Mettha, brought from prison, listened to the court’s decision. The court found that since 2016, the two defendants had operated the Daruma Sushi restaurant and successfully expanded to 27 branches, selling promotional coupons without issue until mismanagement and the Russia-Ukraine war led to a liquidity crisis due to soaring salmon prices. This, the court found, was not due to fraudulent intent but rather a result of business misjudgments.

The court also dismissed the money laundering charges, finding that financial transactions made by Mettha were for legitimate purposes, such as regular transfers to his foster mother and debt repayments, not to conceal or disguise the money’s origins.

Upon hearing the verdict, Mettha, overcome with emotion, hugged his foster mother and expressed immense relief to the press, having spent one year and eight months in detention. The courtroom atmosphere was tense, attended by the defendant’s family but not by the victims.

The court’s decision highlighted the importance of intent in establishing criminal liability. The distinction between business failure due to poor management and deliberate fraud was underscored, providing a significant precedent for similar cases in the future. The ruling not only exonerated Mettha but also drew attention to the complexities of distinguishing between genuine business risks and criminal deception.