On Apr 11, Truong My Lan, chairwoman of property developer Van Thinh Phat Group, was sentenced to death for masterminding the largest fraud case in Vietnam’s history. Charged with embezzlement, bribery and violations of banking rules, she must compensate Saigon Commercial Bank (SCB) 673.85 trillion dong (S$36.7 billion), a sum which exceeds 6 per cent of Vietnam’s gross domestic product in 2023. BY JAMILLE TRAN
Vietnam’s disgraced property queen Truong My Lan
On Apr 26, Lan filed an appeal against the entire first-instance verdict, pledging not guilty to charges of embezzlement and bribery.
I felt so desperate that I thought about death many times.
I was so stupid
to enter the banking field in which I had
no expertise.
Your crime caused extremely serious, irrecoverable losses. The capital punishment is a must to ensure deterrence.
Ma’am, 买化妆品啦!
THE BEGINNINGS Born in 1956 in Ho Chi Minh City, Lan grew up with her Chinese mother’s small cosmetics vendor at a local market. She then became a hair accessories trader and embarked on a business journey with interests spanning commerce, restaurants, hotels, and real estate in her 30s.
Come on in and grab some cool cosmetics at good prices!
VAN THINH PHAT EMPIRE Lan's fortunes turned up when she met her future husband, Hong Kong investor Eric Chu, in the early 90s and established restaurants, hotels, and a property portfolio in Vietnam and Hong Kong. They gradually built up the Van Thinh Phat empire with properties on prime land in Vietnam’s southern economic hub of Ho Chi Minh City.
BANKING INVOLVEMENT In 2011, Lan was involved in the merger of three insolvent private banks into SCB. This paved the way for her manipulation of the bank and cross-ownership with her real estate business, facilitating illicit bank loans and bond issuances via shell companies in the following decade.
SCB can be listed on the stock exchange and see its value triple or quintuple within a
few years. I can then retrieve the assets that were used to buy shares and restructure the struggling bank.
MONEY TRANSFER To cover up the cash flow, Lan ordered SCB officers to withdraw the money in cash or transfer it out of the bank to individuals, pay debts, invest in projects, pay bond interest, and other personal purposes. Fraudulent agreements involving share purchases, loans, capital contributions and consultation also enabled her illicit cross-border money transfers.
BRIBERY Lan’s allies included key executives from SCB and officials at the State Bank of Vietnam, the Government Inspectorate, and the State Audit Office. These government officials were implicated or paid off to cover up violations.
I will arrive at 11:15 am. Madam Lan sent
you some boxes from the bank.
I can’t accept that! Please take it back!
Don’t put others in a tough spot and make things difficult for yourself too!
DOWNFALL Lan and her allies were arrested in October 2022 on suspicion of financial fraud amid the country’s intensifying anti-graft drive with a series of high-profile arrests. She was accused of illegally issuing bonds to raise trillions of dong from investors from 2018 to 2019.
What? I
didn’t do anything wrong!
You’re under arrest for bond fraud!
BANK RUN AT SCB Hordes of people panicked and jostled in front of a SCB branch, intending to withdraw money out of the bank following the news of Lan’s arrest and allegations.
REAL ESTATE SLUMP The case prompted a policy-driven crackdown on crooked financing practices among local property developers and bond issuers, initiating the years-long slump in Vietnam’s real estate sector.
THE SECOND TRIAL From Sep 19, Lan and 33 other defendants were put on a second trial with fresh charges of appropriating property fraudulently, money laundering and illegal cross-border money transfers.
I did not expect
my life to end like this.
I consider this as fate, an accident and take responsibility.
Please consider
returning the two Hermes bags as I want to pass
them on to my children or grandchildren as gifts.
GRAPHICS: SIMON ANG, JESSIE LAM, HYRIE RAHMAT
I want to withdraw all my money!
How long will the lines be?
What will happen to the bank?
I heard they’re out of cash!
I’ll go to a different bank if this isn’t resolved!
This is BT’s retelling of the sequence of events, based on media reports and what was said in court.