Vietnam Tycoon Sentenced to Death in $12 Billion Fraud Case

Wim De Gent
By Wim De Gent
April 11, 2024World News
Vietnam Tycoon Sentenced to Death in $12 Billion Fraud Case
Vietnamese property tycoon Truong My Lan (C) looks on at a court in Ho Chi Minh city on April 11, 2024. (Photo by AFP) (STR/AFP via Getty Images)

No less than 85 people were found guilty in Vietnam on Thursday in the country’s largest-ever fraud case, with a 67-year-old woman who was the center of the operation receiving the death penalty.

Real estate tycoon Truong My Lan, the chairwoman of Van Thinh Phat Holdings Group, was found guilty of defrauding the Saigon Commercial Bank (SCB)—which she indirectly controlled through proxies—of over 304 trillion Dong (over $12 billion) over the course of 11 years.

Ms. Lan was sentenced to death on Thursday for embezzlement and received 20 years each for the charges of bribery and violations of banking regulations.

According to state media, the 2,500 loans Ms. Lan had approved through her influences between 2012 and 2022—and which made up 93 percent of all the bank’s lending—financially affected 42,000 victims and resulted in $27 billion losses to the bank.

According to prosecutors, at one point, over the duration of three years, Ms. Lan ordered her driver to withdraw 108 trillion Vietnamese dongs (more than $4 billion) in cash from the bank and store it in her basement—an amount of paper reported to weigh over two tons.

All of the other defendants—former bankers and ex-government officials—were found guilty as well, with four being sentenced to life in prison and others from 20 to three years’ probation. Among them was Ms. Lan’s husband, a businessman from Hong Kong, who was sentenced to nine years in jail, and her niece, the CEO of Van Thinh Phat, who got 17 years.

Ms. Lan had pleaded not guilty to the embezzlement and bribery charges, one of her lawyers told Reuters.

“Of course she will appeal the verdict.”

Spectacular Trial

Vietnam’s communist authorities abandoned their habitual secrecy for the duration of the trial. The case constitutes the most dramatic episode thus far in the government’s anti-corruption campaign, which has already led to the resignation of two presidents and two deputy prime ministers and disciplinary actions against hundreds of officials since its launch in 2016.

Ms. Lan’s trial began in October 2022 and involved ten state prosecutors, 200 lawyers, 2,700 witnesses and 104 boxes of evidence weighing a total of six tons, according to state media.

“There has never been a show trial like this, I think, in the communist era,” David Brown, a retired U.S. state department official with long experience in Vietnam, told the BBC. “There has certainly been nothing on this scale.”

Rise and Fall of a Tycoon

According to state media, Ms. Lan began her career selling cosmetics at the central market in Ho Chi Minh City with her mother, a Chinese businesswoman.

In 1992, the same year she married, she founded her real estate company. Vietnam had since abandoned its state-run economy in favor of a more free market-oriented approach, and businesses began to flourish.

However, being a communist country, all land in Vietnam is officially owned by the state. Access to property often depends on personal relationships with state officials and as the economy grew, so did corruption. Ms. Lan, like many, took the opportunity and began to build her empire.

By 2011, Ms. Lan had become a well-known developer, and she was allowed to arrange the merger of three smaller banks into a larger entity: Saigon Commercial Bank—a financial institution of which she owned more than 90 percent of the shares, through hundreds of shell companies and numerous proxies, when Vietnamese law prohibits any individual from holding more than 5 percent of any bank.

In her final statement to the court, Ms. Lan confessed to contemplating suicide, saying “In my desperation, I thought of death,” state media reported.

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