Truong My Lan stole the equivalent of 4.69% of Vietnam’s GDP in a decade-long embezzlement scheme
Truong My Lan (C) looks on as she is sentenced to death at a court in Ho Chi Minh city, Vietnam, April 11, 2024 © AFP / STR
Real estate developer Truong My Lan has been sentenced to death by a Vietnamese court for her role in Southeast Asia’s largest ever embezzlement scheme.
The verdict was handed down by a court in Ho Chi Minh City on Thursday after a month-long trial. The court found the 67-year-old guilty of bribery, the violation of banking regulations, and embezzlement, with the latter charge carrying the death penalty due to the amount of money stolen by Lan.
Upon hearing the verdict, the 67-year-old defendant “staggered and was supported by the police,” state news outlet VnExpress reported.
As chairwoman of the real estate developer Van Thinh Phat Holdings Group (VTP), Lan embezzled over 304 trillion dong ($12.5 billion) from Saigon Joint Stock Commercial Bank (SCB), which she effectively controlled using a web of allies and shell corporations. After taking control of the bank in 2012, Lan and her subordinates used thousands of fraudulent loan applications and created phoney withdrawal records to syphon the funds from SCB to her own companies.
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Counting interest accrued on the fraudulent loans, the scam caused damages of roughly 498 trillion dong ($20 billion), or about 4.69% of Vietnam’s GDP.
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Lan used some of these funds to bribe government officials to ignore her crimes. One of these officials, a senior central bank inspector who was paid $5.2 million to overlook the “many serious violations” taking place at SCB, was sentenced to life in prison on Thursday, VnExpress reported.
A total of 86 people were tried for involvement in Lan’s scheme, with four receiving life sentences and the rest handed jail terms of up to 20 years.
As details of the scheme came to light following Lan’s arrest in October 2022, three prominent SCB officials committed suicide, sparking a bank run.
“Truong My Lan did not admit to the crime, was stubborn, blamed her subordinates and didn’t show remorse,” prosecutors argued last month. “The defendant’s actions caused extremely serious and irreparable consequences, so Truong My Lan should be permanently removed from society,” the Vietnam+ newspaper reported at the time.
While the court ordered Lan to return the embezzled funds, prosecutors admitted that much of the cash will never be recovered.
Lan’s high-profile trial was part of a wider anti-corruption drive implemented since 2016 by Communist Party Secretary-General Nguyen Phu Trong. The campaign, nicknamed ‘Blazing Furnace’, has seen two presidents, two deputy prime ministers, and thousands of other government officials and business executives sacked, fined, or jailed for graft.
