PHOTO: Real estate tycoon Truong My Lan attends a trial in Ho Chi Minh City, Vietnam. (Source: Thanh Tung/VnExpress via AP)
Today, real estate mogul Truong My Lan faced a severe verdict from a court in Ho Chi Minh City, Southern Vietnam, in what is considered the nation’s most significant financial fraud case, as reported by state media Vietnam Net.
At 67 years old, Lan, the chairperson of Van Thinh Phat real estate company, was convicted of orchestrating a fraud amounting to US$12.5 billion (NZ$20.8 billion), approximately 3% of the country’s GDP in 2022.
During her tenure from 2012 to 2022, Lan unlawfully controlled Saigon Joint Stock Commercial Bank, greenlighting 2500 loans that led to a staggering loss of US$27 billion (NZ$45 billion) for the bank, according to VnExpress. The court mandated her to compensate the bank with US$26.9 million (NZ$44.8 million).
Despite considerations such as her lack of prior criminal record and engagement in charitable endeavors, the court deemed the gravity of the offense as the primary factor in the harsh sentencing. Lan was portrayed as the mastermind behind a meticulously planned criminal enterprise with severe repercussions, as per VnExpress.
Her actions were condemned for not only infringing upon property management rights but also destabilizing SCB and undermining public trust in the Party and State leadership, as stated in the court’s judgment.
Her niece, Truong Hue Van, who served as the chief executive of Van Thinh Phat, received a 17-year prison sentence for aiding Lan.
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Lan’s rise to prominence began modestly, selling cosmetics at a market stall before establishing Van Thinh Phat in 1992 amid Vietnam’s transition to a market-oriented economy. Over the years, her company burgeoned into one of Vietnam’s wealthiest real estate firms, involved in various upscale projects spanning residential, commercial, and hospitality sectors. Her influence extended into the financial realm, evidenced by her orchestration of SCB’s merger with two other banks in 2011.
The court found that Lan exploited her position to siphon funds from SCB through dubious loans to fictitious companies, a claim she contested. She allegedly channeled these funds back to herself while resorting to bribery to conceal her activities.
Former central bank official Do Thi Nhan also faced severe consequences, receiving a life sentence for accepting bribes.
Lan’s arrest in October 2022 marked a significant milestone in Vietnam’s ongoing anti-corruption campaign, dubbed the Blazing Furnace. The trial’s revelations shocked the nation and raised concerns about systemic issues within the banking sector, contributing to economic uncertainty and investor apprehension.
Vietnam’s real estate sector, in particular, bore the brunt of the fallout, with numerous firms exiting the market, developers resorting to discounts and incentives, and commercial properties remaining unoccupied despite plummeting rents.
Communist Party General Secretary Nguyen Phu Trong reiterated the commitment to the anti-corruption crusade, signaling a long-term endeavor to combat such malfeasance.
SOURCE: 1NEWS