HANOI, Dec 3: The Vietnamese court upheld the death penalty for real estate mogul Truong My Lan on Tuesday, linked to the country’s most significant fraud scandal, which has sparked serious economic concerns.
She was found guilty in April for her involvement in embezzlement and bribery connected to fraudulent activities totaling USD 12.5 billion, which constitutes nearly 3 percent of Vietnam’s GDP in 2022. As the chair of the Van Thinh Phat real estate company, Lan unlawfully managed Saigon Joint Stock Commercial Bank from 2012 to 2022, facilitating 2,500 loans that resulted in losses of USD 27 billion for the bank.
The Ho Chi Minh City court dismissed her appeal against the conviction, noting that her death sentence might be reduced to life imprisonment if she repays three-quarters of the losses, approximately USD 11 billion, as reported by state media.
Her legal team contended that she had returned some funds, but the court rejected this claim due to ongoing legal issues with several seized assets that prevented an accurate valuation, according to VN Express.
Her attorneys also highlighted mitigating factors — her admissions of guilt, expressions of remorse, and partial repayments.
“I feel pained due to the waste of national resources,” she expressed last week, as reported by state media.
However, the court emphasized that her actions adversely affected the banking sector, incited public disorder, and diminished trust among the populace, VN Express mentioned.
According to Vietnamese law, death sentences are not executed immediately and go through an extensive legal review process, stated Nguyen Khac Giang, a visiting fellow at Singapore’s ISEAS–Yusof Ishak Institute. He noted that Lan might request a reevaluation of the case or seek a presidential pardon to mitigate her sentence.
“Additionally, if she reimburses at least three-quarters of the embezzled amount, the court may consider reducing her sentence to life imprisonment,” he mentioned.
Her arrest is among the most notable within an intensified anti-corruption initiative in Vietnam following 2022. The Blazing Furnace campaign reached the highest levels of Vietnamese governance. Yet, the magnitude of her fraud astonished the nation, prompting analysts to speculate whether other banks or companies had engaged in similar misconduct.
This situation has cast a shadow on Vietnam’s economic prospects and caused unease among foreign investors, particularly as the country seeks to attract businesses looking to shift their supply chains away from China.
At 67 years old, Lan and her family founded Van Thinh Phat in 1992, following Vietnam’s transition from a state-controlled economy to a more market-driven system welcoming foreign investment. The company evolved into one of Vietnam’s leading real estate enterprises, comprising luxury residential properties, offices, hotels, and shopping centers.
This positioned her as an influential figure in Vietnam’s financial sector. She was instrumental in the 2011 merger of the struggling SCB bank with two other institutions, coordinating with Vietnam’s central bank. The court stated that she leveraged this situation to generate cash from SCB, with government records indicating she controlled over 90 percent of the bank while approving numerous loans to non-existent companies.
These loans, as per state media, were funneled into her hands, and she allegedly bribed officials to obscure her actions.
The enormity of the crime led to the division of the case into two trials, resulting in an additional life sentence in October. In this trial, she was charged with illegally raising USD 1.2 billion from nearly 36,000 investors through bonds issued by four companies, according to state media.
She was also convicted of misappropriating USD 18 billion and using her controlled entities to illegally transfer over USD 4.5 billion in and out of Vietnam from 2012 to 2022.
Over the past decade, Vietnam has imposed more than 2,000 death sentences and executed over 400 individuals. The death penalty applies to 14 different offenses but is predominantly reserved for severe crimes like murder and drug trafficking. (AP)
