Vietnamese property tycoon sentenced to death in US$27B scam

VIETNAM: Vietnamese property tycoon Truong My Lan faced the ultimate penalty as she was sentenced to death on Thursday (11 April), marking one of the largest corruption cases in history with an estimated US$27 billion in damages.

Following a comprehensive trial presided over by a panel of three jurors and two judges, all defense arguments put forth by Truong, chairwoman of major developer Van Thinh Phat, were ultimately dismissed.

She was found guilty of orchestrating a prolonged scheme to siphon funds from Saigon Commercial Bank (SCB) over a span of ten years.

In delivering the verdict, judges of the People’s Court of Ho Chi Minh City highlighted that Truong’s actions had severely eroded public trust in the leadership of the Communist Party and the state.

Initially accused of embezzling US$12.5 billion, prosecutors revealed during the trial that the total damages caused by the scam had ballooned to US$27 billion – an amount equivalent to 6% of the country’s 2023 gross domestic product (GDP).

The court consequently ordered the 68-year-old to pay almost the entire sum in compensation.

Truong, along with her husband, Hong Kong billionaire Eric Chu Nap-kee, allegedly utilized the ill-gotten funds to establish a sprawling property empire spanning across Vietnam, Hong Kong, and Singapore.

Companies associated with the couple and Van Thinh Phat have been liquidating assets since Truong’s arrest in 2022.

Indicted on 13 December 2023, along with her co-defendants, Truong faced charges including embezzlement, violations of banking regulations, dereliction of duty causing significant harm, abuse of power, bribery, and misappropriation of assets.

The indictment detailed Truong’s collaboration with accomplices within her company, private investment firm An Dong Group, and at Saigon Commercial Bank (SCB), as well as within the government.

Together, they allegedly fabricated 916 false loan documents, granting access to VND 304 trillion (approximately 12.2 billion) in funds from SCB, resulting in losses totalling VND 129 trillion from 9 Feb 2018 to 7 October 2022, the date of Truong’s arrest.

The indictment by the Supreme People’s Procuracy revealed that Truong had gained control of approximately 85 to 91.5 per cent of SCB from 2012 to 2022.

During this period, she purportedly directed and manipulated the bank’s operations to serve the interests of Van Thinh Phat.

Truong and her associates were accused of setting up shell companies, employing individuals to falsify loan documents, and colluding with appraisal agencies to inflate the value of collateral assets.

Moreover, they allegedly orchestrated fake loan applications to withdraw funds from SCB, while also bribing government officials and other authorities to cover their tracks.

Truong has been in custody since her arrest, while her family, businesses, and associates have been rapidly divesting themselves of properties linked to the alleged illicit empire, both domestically and internationally.

For instance, a company owned by Truong and Chu’s daughter, Elizabeth Chu, sold the Nexxus Building in Hong Kong’s Sheung Wan neighbourhood to individuals associated with Steve Chang, co-founder and chairman of Tokyo-listed cybersecurity firm Trend Micro, for a reported HK$6.4 billion (US $819 million).

Similarly, entities controlled by the family sold a hotel in Hong Kong’s Tin Hau area at a 41% discount from its acquisition price in 2017, along with a house in Hong Kong’s Peak area at a 36% discount.

Furthermore, they disposed of a development site in Hong Kong’s Quarry Bay area for HK$435 million.

In Singapore, Viva Land, a local company reportedly affiliated with Truong’s Van Thinh Phat Group, sold the Hotel Telegraph along Robinson Road for an estimated S$170 million to S$180 million in November 2023, incurring a loss of approximately S$70 million compared to its purchase price in 2022.

In March of last year, Viva Land sold 39 Robinson Road in Singapore for S$399 million, marking a transaction where the property changed hands for less than its purchase price.

Despite Viva Land in Singapore denying any affiliation with Viva Land in Vietnam and with Van Thinh Phat in October 2022, a LinkedIn check revealed that Lian Pang Chen, a former CapitaLand executive, assumed the role of chairman at Ho Chi Minh City-based Viva Land upon its establishment in 2020.

Chen is also registered as the sole director of Viva Land in Singapore.

Notably, he led Capitaland’s Vietnam business from 2013 through December 2021 before becoming chairman of Viva Land in August 2020, coinciding with the company’s inception.

A 2020 Mingtiandi report identified Viva Land as a British Virgin Islands-registered entity controlled by an investor from Vietnam.

The report detailed the acquisition of the 39 Robinson Road building from Tuan Sing Holdings, with the sale valued at S$500 million (US$371 million).

Viva Land, originally known as Circus Power, primarily operates in the real estate sector.

With headquarters in Hanoi, Ho Chi Minh City, and Singapore, Viva Land is chaired by Chen, with Eddie Lim serving as CEO.

An article published in May 2022 by CEO Magazine described Eddie Lim as having spent 25 years at CapitaLand before assuming the role of CEO at Viva Land.

Chen, on the other hand, is recognized as a seasoned developer with over 40 years of experience in real estate investment and development.

Source: The CEO Magazine

Presently, Viva Land owns and manages several prominent projects situated on prime land in Hanoi and Ho Chi Minh City.

Singapore Chamber of Commerce Vietnam mentioned that Viva Land is currently developing and managing more than 1,500 hectares of land and over 18,000 residential units including IFC One Saigon, Saigon Peninsula, Capital Place and many others.

Following a five-week trial, 85 individuals faced sentencing on charges ranging from bribery and abuse of power to appropriation and violations of banking law.

Among them, four received life imprisonment, while the remainder received jail terms ranging from 20 years to three years suspended.

Eric Chu, a central figure in the case, was sentenced to nine years in prison.