Vietnamese Court Sentences Property Tycoon to Death in Giant Fraud Case

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Vietnamese Court Sentences Property Tycoon to Death in Giant Fraud Case

Truong My Lan was found guilty of embezzling an astonishing $12.54 billion from Saigon Commercial Bank in the decade to 2022.

Vietnamese Court Sentences Property Tycoon to Death in Giant Fraud Case
Credit: © Serhii Yevdokymov |

The Vietnamese businesswoman Truong My Lan was sentenced to death yesterday by a court in Ho Chi Minh City, bringing to an expected end one of the country’s largest-ever corruption cases.

The wealthy 68-year-old, who headed real estate company Van Thinh Phat (VTP), is accused of using “thousands of ghost companies” to embezzle 304 trillion dong ($12.54 billion) from Saigon Commercial Bank (SCB), in collusion with family members and scores of accomplices.

Truong My Lan’s trial opened last month and was expected to last until April 29, but judges at the People’s Court of Ho Chi Minh City unexpectedly announced the sentence yesterday, finding her guilty of multiple counts of bribery, violating banking regulations, and embezzlement. The court also ordered her to pay 673.8 trillion dong ($29.6 billion) in compensation to SCB.

While the judges acknowledged that Lan did not have a criminal record before the trial, and had participated in numerous charitable activities, “she was the mastermind in the long-term scheme and committed elaborate and organized crimes, causing irrevocable consequences,” according to the paraphrase in a VnExpress report.

In handing down the death sentence, the court stated that Lan’s actions “not only violate the property management rights of individuals but also pushed SCB into a state of special control, eroding people’s trust in the leadership of the party and state.”

According to a report in the Daily Beast, Lan, who was arrested in October 2022, broke down in tears before the sentence was announced. It was “due to my lack of understanding of legal matters,” she told the court, that she “did the wrong things.”

Prosecutors had demanded the death penalty for Lan late last month, arguing that Lan needed to be “ostracized from society forever.” Ahead of the verdict yesterday, the court stated that she deserved the “toughest sentence.”

According to the court, Lan was involved in the 2011 merger of the beleaguered SCB with two other lenders in a plan coordinated by Vietnam’s Central Bank. The court largely accepted the argument made by investigators, that Lan came to hold indirectly a 91.5 percent stake in SCB and had ordered its executives to approve loans for a constellation of shell companies controlled by VTP, which were then withdrawn. According to VnExpress, “from 2012 to 2022 Lan and her accomplices obtained 2,500 loans and caused losses of 677 trillion dong [around $27 billion] to the bank.” The $12.54 billion allegedly embezzled by Lan amounts to an astonishing 3 percent of Vietnam’s gross domestic product in 2022.

Of the other 85 defendants on trial in the sprawling case, Do Thi Nhan, an official at the State Bank of Vietnam official who was accused of accepting a $5.2 million bribe from Lan to overlook illegal activity at SCB, was sentenced to life in prison. Lan’s husband, Erik Chu Nap-Kee, a Hong Kong national, was sentenced to nine years in prison, while her niece Truong Hue Van, received 17 years.

That the court handed down the death sentence is not surprising – in such high-profile cases, Vietnamese prosecutors usually get what they want – but it is rare for financial crimes. But the case has scandalized a population that is by no means unfamiliar with large-scale corruption scandals, and it is clear from the wide latitude that the country’s tightly invigilated media has been granted to report on every sordid twist and turn of the trial, that the authorities intend to make an example in Lan.

The fraud scandal is the largest and most elaborate so far excavated by the country’s ongoing “blazing furnace” anti-corruption campaign, which has been burning hotly since 2016. Weeks after her trial started in early March, former President Vo Van Thuong resigned after being caught in the anti-corruption dragnet, the second president to do so in as many years.

While the sentences have now been handed down, the magnitude and complexity of the Van Thinh Phat fraud ensures that it will “reverberate for years,” journalist Michael Tatarski wrote in his Vietnam Weekly newsletter. “Officials will now have to work through the hideously complicated task of handling the hundreds of VTP-linked properties seized from Lan and her family,” he wrote.