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Vietnamese Real Estate Tycoon Sentenced to Death Over $27bn Fraud

Vietnamese real estate tycoon Truong My Lan has been sentenced to death for partaking in the country’s biggest fraud case to date.

Featured Image Credit: Gorodenkoff/Shutterstock

Vietnamese real estate tycoon Truong My Lan has been sentenced to death for partaking in the country’s biggest fraud case to date.

The property tycoon was found guilty of embezzling billions of dollars from Saigon Commercial Bank (SCB).

Lan’s case shocked the nation, and it was part of a wider crackdown on corruption in Vietnam.

67-year-old Lan was the widely successful chairperson of developer Van Thinh Phat before being found guilty earlier this month of bribery, embezzlement and banking violations.

What makes Lan’s case significant?

The immense scale of the financial fraud makes Lan’s case so noteworthy. In total, $12.5bn was embezzled – equating to around 3% of Vietnamese gross domestic product.

Yet ahead of Lan’s sentencing, prosecutors stated that damages resulting from the fraud amounted to $27bn.

Lan was found guilty of siphoning money from SCB over the course of a decade. After being arrested in October 2022, the tycoon maintained that she was innocent until her fateful sentencing.

An Astronomical Amount Of Money Was Reportedly Siphoned. Image Credit: tech_BG/Shutterstock

The tycoon owned 91.5% of SCB’s shares via shell companies and third parties.

Lan faced a tense trial alongside 85 other suspected fraudsters. The other suspects comprised former government officials, bankers, and previous executives of SCB.

During depressive episodes, while awaiting her verdict, Lan urged the court to be lenient on her husband and niece – both of whom were simultaneously on trial as accomplices.

As Lan heard the verdict following the highly publicized trial in Ho Chi Minh City, the following statement was read to demonstrate the severity of the corruption charge: “The defendant’s actions… eroded people’s trust in the leadership of the party and state.”

During court proceedings, Lan was accused of creating falsified loan applications in order to withdraw large sums from SCB between 2012 and 2022. Vietnamese state media reported that the loans constituted 93% of SCB’s total issued credit.

A fraudulent cover-up

During Lan’s trial, it was surmised that she and fellow SCB bankers bribed state officials with $5.2m to hinder fraud charges. This figure remains the largest bribe reported throughout Vietnamese history.

According to Do Thi Nhan, a then-chief banking inspector at the State Bank of Vietnam, the siphoned money was transferred via Styrofoam boxes to boost concealment during the attempted bribery.

Saigon Commercial Bank Building
Saigon Commercial Bank Building. Image Credit: Poetra.RH/Shutterstock

Upon discovering the immense monetary value contained within the boxes, Nhan told the trial that she refused to accept the bribe – but was faced with Lan deciding not to take them back.

The country’s media outlets reported that Lan claimed to have become involved with the banking industry with insufficient knowledge of what such a role would encompass legally.

How Corruption Pervades Vietnam

Within Vietnam, however, ‘official’ statements reported across state media are tightly controlled.

Secretary General of the Communist Party of Vietnam, Nguyễn Phú Trọng, established the national corruption crackdown back in 2021 – and Lan’s trial is very much the result of the relentless campaign.

Referred to as ‘Blazing Furnace,’ the anti-corruption campaign has heightened in intensity and scale in recent years.

As such, thousands of people in Vietnam have been arrested on some form of corruption charges.

Man Counts Money In Ho Chi Minh City.
Man Counts Money In Ho Chi Minh City. Image Credit: WorldStockStudio/Shutterstock

The significant campaign also coincided with two of the country’s presidents resigning, in addition to two deputy prime ministers – all of which occurred because of various forms of corruption.

Perhaps Vietnam does not spring to mind at first when considering tightly controlled state media. But Lan’s five-week trial and verdicts were reported overwhelmingly, yet in an especially restricted manner by the Vietnamese media.

Regardless of Vietnam’s rather authoritarian stance on corruption, the fact that the death sentence was not only considered but decided upon raised concerns among Lan’s family.

One of the tycoon’s relatives stated pre-verdict that Lan intended to appeal, further highlighting the atypical severity of the punishment.

Is The Tide Changing On Vietnam’s One-Party State?

Lan’s case was certainly unprecedented, emphasizing Vietnam’s vehement crackdown on corruption.

According to Dr Nguyen Khac Giang, a Vietnam Studies visiting fellow at the Iseas-Yusof Institute, Lan’s case was “the biggest case against a private business, with the biggest number of defendants, the biggest number of evidence and, of course, the biggest number of money involved.”

With almost 2,700 people being summoned for the trial, including 200 lawyers, it certainly was a substantial case.

Police Officers Patrol Ho Chi Minh City
Police Officers Patrol Ho Chi Minh City. Image Credit: StreetVJ/Shutterstock

The mission was clear: for Trong to cement Thailand’s zero-tolerance approach to leniency when it comes to purported corruption.

Gauging the sentiment among the Vietnamese public regarding the anti-corruption campaign is thus especially difficult.

Vietnam is a one-party state with heavily restricted media. Therefore, inevitably, many question whether large-scale corruption could feasibly persist and go unchecked over such a long duration.

According to Giang, the case “might indirectly signal that the state hasn’t really been doing well in terms of managing the system in terms of the increasingly complex market economy and also the state is incapable of controlling their own public officials.”

Perhaps the majority of Vietnamese residents do, in fact, commend the state crackdown on corruption and fraud.

But gauging such reactions can only be made possible if the country’s authoritarian state control is toned down significantly.

Written By

I am an MLitt Digital Journalism Masters student at Strathclyde University, and a 2.1 graduate of English Literature (MA Hons) at the University of Edinburgh. Engaging for a decade with journalistic writing and reporting, I have been involved with a broad range of media work; from sports journalism and features, to news writing and disability awareness.

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