This is the biggest financial scandal Vietnam has ever known. Truong My Lan, the director of the Van Thinh Phat real estate group, was sentenced to the death penalty on Thursday April 11 in a fraud case whose damages were estimated by the prosecution at 25 billion euros.
The actions of Ms. Truong, accused of defrauding funds from the Saigon Commercial Bank (SCB) for a decade, “eroded people’s confidence in the leadership of the [communist] party and the state,” said the jury, according to state media, during the trial held in a court in Ho Chi Minh City.
The president of the conglomerate was found guilty of corruption, embezzlement and violation of banking law. The businesswoman denied her role in the affair and placed the blame on her subordinates. During a trial that lasted about a month, Ms. Truong and 85 other defendants appeared to answer the questions and anger of thousands of aggrieved savers, who lost their funds almost overnight.
25 billion euros
The list of accused included former central bank officials, ex-government members as well as executives of the bank involved in the fraudulent scheme, Saigon Commercial Bank (SCB). The death penalty had only been requested by the prosecutor against Ms. Truong, considered the mastermind of the operation.
She is convicted of defrauding around 42,000 people between 2012 and 2022, through a financial arrangement transiting through SCB, more than 90% owned by her group, with the complicity of officials responsible for supervising the banking sector.
Ms. Truong was arrested in October, accused of embezzling 304,000 billion dong, or approximately 11.5 billion euros, which allegedly fueled her luxurious lifestyle and was used for corruption. But the prosecution said on Thursday that the total damage caused by the scam now stood at $27 billion (around €25 billion), or the equivalent of 6% of the country’s GDP in 2023.
Collective anger
At the time of her last public speaking, during the hearings, she confessed to having thought about suicide. “In my despair, I thought about death,” she said, in comments reported by Tuoi Tre, a state newspaper. During the trial, prosecutors also reported more than a thousand properties confiscated from Ms. Truong.
The scale of the scandal pushed hundreds of people to demonstrate in the streets of the capital, Hanoi, and in Ho Chi Minh City, in an unusual expression of collective anger tolerated in the communist country. On Wednesday, a large police force was deployed in front of the headquarters of the central bank in Hanoi, the location of previous rallies.
The use of the death penalty is commonplace in Vietnam for drug cases, but remains rare for economic offenses or crimes. Amnesty International estimates that “numerous” executions take place each year, in the order of several dozen per year.
