In Ho Chi Minh City on April 11, 2024, Vietnamese real estate tycoon Truong My Lan was sentenced to death for her role in the most significant fraud case in the history of Vietnam, amounting to around 27 billion in damages.
Vietnam’s most significant financial fraud trial began on March 5, and Truong My Lan was one of 85 defendants. The jurors and judges overseeing her case rejected all of her defenses. She was convicted of several different financial crimes, including violations of banking laws, bribery, and embezzlement.
Vietnamese banking law stipulates that individuals are forbidden from owning more than a 5% individual stake in a banking organization. It was found that she had been using shell companies and proxies to obscure the fact that she owned around 90% of Saigon Commercial Bank.
She was also accused of appointing managers and bribing officials to approve loans, which accounted for 93% of the bank’s lending operations. Truong was charged with embezzling 12.5 billion dollars from the Vietnamese government and financially harming and scamming around 42,000 Saigon Central bondholders, who still are unable to withdraw money or receive interest.
The verdict stated that she had to return the money she had stolen through her scam, which allegedly lasted 11 years. She also earned 40 years in prison for violation of banking rules and bribery and was sentenced to death for the charge of embezzlement.
Her actions hurt a lot of different people; however, many believed that the death sentence for the charge of embezzlement was too much. Fiona Peterson (11), who was familiar with the case, was against the death penalty sentencing imposed due to her principles against the death penalty.
Mythili Shah (10), who had not heard of the case prior, felt that the death penalty was not a valid punishment as it was a nonviolent offense. However, in Vietnam, you can receive the death penalty for both violent and nonviolent crimes, such as in this case.
Truong My Lan was only sometimes the towering figure she would grow to become in Vietnamese financial and political circles. She began her journey in finance, working at a market stall with her mother selling cosmetics. However, the Communist Party of Vietnam was interested in ushering in economic reforms with Doi Moi in the mid-1980s. These reforms opened up the economy in Vietnam and enabled Lan to begin purchasing land and property. Throughout the 1990s, she continued to expand her portfolio of properties, adding restaurants, hotels, and more. In 1992, she founded the Vạn Thịnh Phát Group, a real estate company for high-end properties and financial services. Her power and wealth in Vietnam had grown so immense that in 2011, she arranged the merger of three banks on the brink to form Saigon Commercial Bank. She would then use this bank and those there whom she had control over to her financial benefit.
In 2016, Vietnam Communist Party General Secretary Nguyen Phu Trong initiated a crackdown on corruption called the burning furnace campaign. Since the campaign started, hundreds of Vietnamese senior government officials and business leaders have resigned and been prosecuted for corruption and crimes. The case involving Truong My Lan and the 84 others is another high-profile case this campaign brought about. Internal Vietnamese and United Nations reports have found corruption to be a rampant problem across Vietnam, even in public hospitals.
The Vietnamese government hopes that the publicity and action undertaken in the burning furnace campaign can help reduce corruption in Vietnam and change public perceptions. However, Mr. Kurkjian (Social Studies) is concerned that discouraging corruption will prompt criminals and corrupt officials to conceal and hide their fraudulent and malicious activities instead of preventing corruption.
Truong My Lan and others involved are expected to appeal the decision. However, based on the recent attempts to crack down on corruption, she may be stuck with her sentence. This case will not be the last brought forward during the burning furnace campaign in Vietnam. However, whether or not this will encourage others to stop their corrupt actions or attempt to conceal and hide them better has yet to be seen.
