Truong My Lan was accused of bribing Saigon Joint Commercial Bank staff, appraisers, and Vietnamese government officials to approve and cover up $42 billion in fraudulent loans to shell companies under her control. There is still $27 billion in bank deposited funds that are outstanding, as she used bank funds to purchase hotels, condos, and office/retail spaces for her company. She was sentenced to death on April 11, with additional charges for bribery and violation of lending regulations - amounting to 40 years. Some believe the harshness of this sentence is to pressure Lan to provide the remaining $27 billion yet to be returned.
She oversaw the merger of First Bank, TinNghiaBank, and Saigon Bank, forming SCB in 2012. Claiming a modest 4.9% of SCB shares on paper, she then utilized a web of shell corporations, business associates, and personal connections, including her husband, to amass a staggering 91.5% of SCB’s shares, a move that went unnoticed for years.
She then strategically appointed individuals within the bank, granting them authority to authorize loans to the various entities she used to amass the 91.5% stake in SCB. Alongside Lan, 86 additional individuals, including 18 agents from Vietnam’s bank inspection agency, were implicated in this scandal.
Lan made these moves while former Vietnamese Prime Minister Nguyen Tan Dung was in office from 2006 to 2016. Infamously, under his control, Vietnam had a surge in corruption, which made the 2012 establishment of SCB susceptible to this kind of fraud. Under the current leadership, the Communist Party Leader, Nguyen Phu Trong, has been making anti-corruption efforts. Coined the “Blazing Furnace” campaign, Trong is going after long-standing officials and private sector individuals he and his party believe pose a risk and may have ties to the Tan Dung era of Vietnam. The escalation in anti-corruption efforts stems from the need for political and financial stability within Vietnam and making the country more attractive to Western allies with whom they would like to do business. If successful, Vietnam wants to be considered a stable trading partner over China.
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