Vietnamese billionaire sentenced to death in $12.5bn fraud case
A Vietnam court sentenced real estate tycoon—Truong My Lan (67)—to death over her role in a 304 trillion dong ($12.46 billion) fraud case, the country's biggest on record. Lan—the chairwoman of Van Thinh Phat Holdings Group—was found guilty of embezzlement, bribery, and violations of banking rules. Lan and her accomplices were accused of siphoning off over 304 trillion dong from Saigon Joint Stock Commercial Bank—which she effectively controlled through proxies. This is equivalent to 3% of Vietnam's GDP.
Why does this story matter?
The trial was the most dramatic and intense phase thus far in the anti-corruption initiative spearheaded by the Communist Party Secretary-General, Nguyen Phu Trong. He launched the campaign in 2016 after outmaneuvering the then-business-friendly prime minister to retain the party's leadership. Since then, two presidents and two deputy prime ministers have resigned as a result of the campaign, and hundreds of officials have been reprimanded or imprisoned.
High-profile defendants accused of multiple crimes
The list of defendants in the case included former central bankers, ex-government officials, and past executives of the SCB. They are accused of a variety of crimes including bribery, abuse of power, misappropriation, and violations of banking law. These charges were laid out during a five-week trial held in Ho Chi Minh City. Lan had denied these allegations, instead attributing the supposed crimes to her subordinates.
Mogul expresses remorse, contemplates suicide amid trial
In her final statement to the court, Lan confessed to contemplating suicide due to her desperation. As reported by state media, she said, "In my desperation, I thought of death." She also expressed regret about her involvement in the banking sector and admitted that she had little understanding of it. Lan will appeal the verdict, a family member told Reuters before it was issued.
Protests erupt following arrest, thousands affected
Following Lan's arrest in October 2022, protests broke out in Hanoi and Ho Chi Minh City with hundreds of people participating. Notably, authorities have identified approximately 42,000 victims affected by this scandal which has sent shockwaves through the Southeast Asian nation. The victims are all SCB bondholders who have been unable to withdraw their funds or receive interest or principal payments since Lan's arrest.
Alleged fraudulent activities and bribery uncovered
Lan is accused of creating fraudulent loan applications to divert funds from SCB, where she held a 90% stake. During the trial, it was revealed that over 1,000 properties owned by Lan had been seized by prosecutors. Additionally, a record-breaking bribe of $5.2 million was allegedly given by Lan and some SCB bankers to state officials to conceal the bank's violations and poor financial health.
Who is Lan
Starting as a market stall vendor with her mother, Lan transitioned into property investment during Vietnam's economic reform period, "Doi Moi," from 1986. By the 1990s, she amassed a significant portfolio of hotels and restaurants. Despite Vietnam's manufacturing growth, wealth primarily stems from property development and speculation due to state-owned land and reliance on personal connections for access. Corruption surged alongside economic expansion, becoming entrenched in the system.