New Delhi: Vietnam has sentenced its richest woman to death for carrying out one of the biggest financial frauds in the country’s history.
Tycoon Truong My Lan, whose net worth is nearly 10 percent of the country’s GDP, was found guilty of involvement in a real estate scam that syphoned off $12.5 billion from large private lender Saigon Joint Stock Commercial Bank (SCB) through loans to shell companies. She got the death penalty for the embezzlement.
The 67-year-old was also held culpable of bribery and violation of banking regulations, for which she got 20 years each.
Lan started off as a cosmetics seller and went on to found the property firm Van Thinh Phat (VTP) in 1992 as Vietnam moved towards a market-oriented economy.
Her real estate company executed Vietnam’s most valuable projects, including the 39-story Saigon Times Square and the five-star Windsor Plaza Hotel in Ho Chi Minh City.
A total of 42,000 people were identified as victims of Lan’s crimes, and her arrest in October 2022 sparked anti-bank protests in Hanoi and Ho Chi Minh City, a rare occurrence in Vietnam.
The mastermind behind the huge fraud, Lan had taken loans of almost $44 billion from the SCB over 11 years. Although Vietnamese law does not allow any individual to hold more than 5 percent of a bank’s shares, Lan owned 90 percent of SCB through mergers of smaller banks and control exerted through shell companies and proxies.
Her asset appropriation in the past 10 years was about 10 percent of the country’s GDP in 2022, Vietnam News reported.
She has also been convicted of bribing Do Thi Nhan, a former central bank inspector, to look away. The VTP chairperson gave Nhan $5.2 million — the largest recorded bribe in Vietnam. The former banking official has been sentenced to life imprisonment.
Eighty-five others, including Lan’s husband, niece and several SCB executives, were also sentenced at the court in Ho Chi Minh City on Thursday.
A sentence as severe as the crime
Apart from death and the 40 years in jail, Lan has also been ordered to pay $27 billion in damages to the Saigon Joint Stock Commercial Bank.
The death sentence is a rarity for a white-collar or financial crime, though rights groups say Vietnam has executed hundreds of convicts in recent years, mostly by lethal injection.
The severity of Lan’s crimes lies in the huge amount of money involved — from bribes to loans to Lan’s personal property — which is unheard of in Vietnam, even for a tycoon. Her crimes have put a spotlight on the “trust in leadership and the state”, which prompted the court to go for the “highest punishment”.
Furthermore, the case brings to light the government’s agenda to stamp out corruption in a continuing operation termed “Blazing Furnace”. Last month, Vietnamese President Vo Van Thuong had to step down for “violating” rules and behaviour that “negatively impacted” the ruling party. The anti-corruption drive is aggressive as various officials and politicians have been accused of corruption.
Court also tough on Lan’s billionaire husband, niece
Lan was one of the 85 accused in the case decided by three special jurors and two judges during a five-week trial. The sentencing for them ranged from probation to life imprisonment.
“The defendant’s actions not only violate the property management rights of individuals and organisations but also put SCB under scrutiny, eroding people’s trust in the leadership of the Party and State,” state newspaper VnExpress cited the jury as saying.
Lan’s husband, Eric Chu Nap-kee, a Hong Kong national, has been sentenced to nine years for violating banking regulations at the behest of Lan. Her niece, Truong Hue Van, the CEO of Windsor Property Management — another company in the Van Thinh Phat ecosystem — was convicted of embezzlement and sentenced to 17 years in prison.
Banking officials, including those on the board of directors of the Saigon Joint Stock Commercial Bank, were also variously sentenced.
While all convicts admitted to wrongdoing, Lan till the end pleaded her innocence, blaming her subordinates. Under the law, Lan can file an appeal against her conviction in the next 15 days.
(Edited by Tikli Basu)
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