Search Here

A court in Ho Chi Minh City in southern Vietnam has sentenced real estate tycoon Truong My Lan to death in the country's largest financial fraud case ever.

Truong My Lan, the chair of major developer Van Thinh Phat, has been accused of engaging in fraudulent activities totaling $12.5 billion, which is approximately 3 percent of the country's projected GDP for 2022.

Vietnamese Billionaire Sentenced to Death in Vietnam's Largest Fraud Case

During the period from 2012 to 2022, she used unauthorized control over the Saigon Joint Stock Commercial Bank, using a network of ghost companies and engaging in bribery of government officials to divert funds.

Approximately 2,500 loans were approved under Truong My Lan's supervision, leading to significant losses of $27 billion for the bank. The court has ordered her to pay the bank a hefty sum of $26.9 million, BBC reported.

Despite some factors that could have been considered in Truong My Lan's favor, such as being a first-time offender and involvement in charity work, the court handed down a severe sentence.

The court justified this decision by highlighting the gravity of the case, stating that Lan was the mastermind behind a well-organized and complex criminal operation that had significant and irreversible consequences, with no hope of recovering the money involved.

The judgment stated that her actions have not only infringed upon the property management rights of individuals and organizations, but have also placed SCB (Saigon Joint Stock Commercial Bank) under special control, undermining people's trust in the leadership of the Party and State.

Truong Hue Van, the chief executive of Van Thinh Phat, has been sentenced to 17 years in prison for her involvement in aiding her aunt.

Who is Truong My Lan?

In 1992, Truong My Lan and her family founded the Van Thing Phat company, taking advantage of Vietnam's shift towards a market-oriented economy that welcomed foreign investors.

According to state media Tien Phong, she began her journey by helping her mother, a Chinese businesswoman, in selling cosmetics at Ho Chi Minh City's oldest market.

Van Thinh Phat has emerged as one of Vietnam's most prosperous real estate companies, boasting an impressive portfolio of luxury residential buildings, offices, hotels, and shopping centers.

Lan's role in the country's financial industry was significant. She played a key role in facilitating the 2011 merger of the struggling SCB bank with two other lenders, working closely with Vietnam's central bank.

It was determined by the court that she employed this method to obtain funds from SCB. According to government documents, she has been accused of indirectly owning over 90% of the bank, a charge that she vehemently denies.

Additionally, she allegedly approved numerous loans to "ghost companies." According to the court's findings, state media VNExpress reported that these loans eventually made their way back to her.

According to the report, she allegedly bribed officials to conceal her actions. A former central bank official named Do Thi Nhan has been sentenced to life in prison for accepting a significant amount of money in bribes.

Lan's arrest in October 2022 garnered significant attention as part of an ongoing anti-corruption campaign in Vietnam that has been gaining momentum since 2022.

The widely known Blazing Furnace campaign has made its way into the uppermost levels of Vietnamese politics. In March, Former President Vo Van Thuong stepped down following his alleged involvement in the campaign, according to AP News.

However, Lan's trial left the entire nation in a state of shock. Experts noted that the magnitude of the fraud has raised concerns regarding potential errors in other banks or businesses, which has had a negative impact on Vietnam's economic prospects.

This has also made foreign investors uneasy, especially as Vietnam has been striving to establish itself as an attractive destination for businesses looking to shift their supply chains from China.

Tags

Vietnam