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Vietnam sentences real estate tycoon Truong My Lan to death in its largest-ever fraud case

HANOI, Vietnam (AP) — Real estate tycoon Truong My Lan was sentenced to death Thursday by a court in Ho Chi Minh City, southern Vietnam, in the largest financial fraud case ever known in the country, state media Vietnam Net reported.

Real estate company chairman Van Thinh Phat, 67, has been formally charged with fraud amounting to $12.5 billion, or nearly 3% of the country’s GDP in 2022.

Lan illegally controlled Saigon Joint Stock Commercial Bank between 2012 and 2022 and authorized 2,500 loans that resulted in $27 billion in losses for the bank, state media VnExpress reported. The court asked him to compensate the bank $26.9 million.

Despite mitigating circumstances – it was a first offense and Lan was involved in charitable activities – the court attributed his heavy sentence to the seriousness of the case, saying Lan was the head of an orchestrated criminal enterprise and sophisticated which had serious consequences with no possibility of the money being recovered, VnExpress said.

His actions “not only violate the property management rights of individuals and organizations, but also push SCB (Saigon Joint Stock Commercial Bank) into a state of special control; eroding the people’s confidence in the leadership of the Party and the state,” VnExpress said citing the judgment.

Her niece, Truong Hue Van, general manager of Van Thinh Phat, was sentenced to 17 years in prison for helping her aunt, and Lan’s husband, Eric Chu Nap-kee, originally from Hong Kong, was sentenced to nine years in prison.

Lan and his family established the Van Thing Phat company in 1992 after Vietnam abandoned its state-run economy in favor of a more market-oriented approach open to foreigners. She began by helping her mother, a Chinese entrepreneur, sell cosmetics in Ho Chi Minh City’s oldest market, according to state media Tien Phong.

Van Thinh Phat would go on to become one of Vietnam’s richest real estate companies, with projects including luxury residential buildings, offices, hotels and shopping malls. This has made it a key player in the country’s financial sector. She orchestrated the 2011 merger of the troubled SCB Bank with two other lenders, in coordination with Vietnam’s central bank.

The court found that she used this approach to obtain money from SCB. She indirectly owned more than 90% of the bank – a charge she denied – and approved thousands of loans to “ghost companies,” according to government documents. These loans were then returned to him, state media VnExpress reported, citing the court. results.

She then bribed officials to cover her tracks, he adds.

Do Thi Nhan, a former central bank official, was also sentenced to life in prison on Thursday for accepting $5.2 million in bribes.

Lan’s arrest in October 2022 was one of the most high-profile in Vietnam’s ongoing anti-corruption campaign that has intensified since 2022. The so-called Burning Furnace campaign has reached the highest echelons of Vietnamese politics. Former President Vo Van Thuong resigned in March after becoming involved in the campaign.

But Lan’s trial shocked the nation. Analysts said the scale of the scam raised questions about whether other banks or companies had made a similar mistake, dampening Vietnam’s economic outlook and making foreign investors nervous at a time when Vietnam is trying to position itself as the ideal country for companies trying to reorient their offering. channels away from China.

The real estate sector in Vietnam has been particularly affected. An estimated 1,300 property companies pulled out of the market in 2023, developers offered discounts and gold as freebies to lure buyers, and despite rents on mixed-use properties falling by a third Known in Southeast Asia as shophouses in Ho Chi Minh City, many in the city center are still empty, according to state media.

In November, Communist Party General Secretary Nguyen Phu Trong, Vietnam’s top politician, said the anti-corruption fight would “continue for the long term.”

News Source : finance.yahoo.com
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