Vietnam Real-Estate Tycoon Given Death Penalty, Embezzled 3% of GDP

• Real estate tycoon Truong My Lan has been sentenced to death by a Vietnamese court.
• She was found guilty of embezzlement, corruption and violating banking rules.
• Prosecutors said she embezzled more than $12 billion, or about 3% of Vietnam’s GDP in 2022.

A Vietnamese real estate tycoon was sentenced to death by a court in Ho Chi Minh City on Thursday for her role in a multibillion-dollar financial fraud case.

Truong My Lan, chairwoman of real estate developer Van Thinh Phat Group, was arrested in 2022.

The fraud trial, which began on March 5, was the largest ever seen in Vietnam and one of the most significant corruption scandals in Southeast Asia. Lan was found guilty of embezzlement, bribery and violating banking rules.

The case dates back to his involvement in the 2011 merger between Saigon Commercial Joint Stock Bank and two other banks.

Lan was accused of illegally controlling Saigon Commercial Bank and using shell companies to obtain more than 2,500 loans for herself and her accomplices, according to local media outlet VnExpress.

Although Lan did not directly hold executive power within the bank, she exercised significant control, owning 91.5% of the bank’s shares through third parties and shell companies, The Guardian reported.

Prosecutors said that over a decade, Lan embezzled $12.5 billion, or about 3% of Vietnam’s GDP in 2022, AP and Bloomberg reported.

However, according to VnExpress, prosecutors added that the estimated damage caused to the bank by the scam was much more – around $27 billion.

The verdict requires Lan to return that sum as compensation, which prosecutors said was highly unlikely, according to BBC News.

Lan was also accused of bribing government officials to cover up the fraud and violating banking regulations, AP reported. A family member told Reuters that Lan planned to appeal the verdict.

Although prosecutors identified Lan as the ringleader, others involved are also being punished.

Former executives of Saigon Commercial Bank were sentenced to life in prison, along with a senior official of Vietnam’s central bank, VnExpress reported.

Family members were also involved. Lan’s husband, Eric Chu, was sentenced to nine years in prison on Thursday for helping his wife, while her niece, Truong Hue Van, was sentenced to 17 years in prison, the outlet reported.

The death penalty is not uncommon in Vietnam, but it is mainly imposed in cases of drug trafficking or murder, not corruption.

The severity of Lan’s punishment appears to reflect Vietnam’s ongoing, high-profile campaign against corruption.