A bank CEO and real estate tycoon have been found guilty in a $154 million graft case.
The Ho Chi Minh City People’s Court Thursday sentenced former CEO of DongA Bank Tran Phuong Binh, fallen Da Nang real estate tycoon Phan Van Anh Vu and 24 others to various prison terms in a massive graft case that is said to have caused losses of more than $154 million for the bank.
Binh, 59, who was arrested in 2016, will spend the rest of his life behind bars for “deliberately violating state regulations on economic management, causing serious consequences” and “abusing position and power to appropriate assets,” the court ruled.
He is held mainly responsible for losses of nearly VND3.5 trillion ($153.8 million) at the partly state-owned bank, which was incurred as the bank had paid interest to customers beyond the regulated rates, committed violations in foreign currency and gold trading, and got involved in a share-buying scheme.
Vu, 43, received 17 years for “abuse of power to appropriate property.”
According to the indictment, in 2013, DongA Bank planned to raise its charter capital from VND5 trillion ($220 million) to VND6 trillion despite having several financial issues. To achieve this goal, Binh convinced Vu to buy 60 million shares in the bank for VND600 billion.
To raise cash for the deal, Vu mortgaged a plot of land with the bank to secure a VND400 billion loan. Binh then had his subordinates falsify paperwork for the remaining VND200 billion ($8.8 million).
However, the plan to raise the bank’s capital fell through, so Binh instructed his staff to transfer VND600 billion plus interest to Vu’s company, although the latter had only paid VND400 billion to the bank in the original share purchase deal.
Investigators concluded that Vu had misappropriated VND200 billion from the bank. He has admitted to this, but claimed he had only been following Binh’s instructions.
He also repaid the money to minimize the damage incurred by the bank.
The rest of the money is no longer retrievable, investigators said.
At the Thursday trial, Nguyen Thi Kim Xuyen, former deputy chief executive officer of DongA Bank, got a 30-year jail term for serving as Binh’s accomplice. Other defendants received between two-year suspended sentence and 16 years in jail as the trial closed after three weeks.
Dong A Bank came under the spotlight in 2014 when it posted a pre-tax profit of just VND35 billion ($1.5 million), down 96 percent from 2013.
The bank was placed under special monitoring in August 2015 after an investigation by the central bank uncovered several violations in financial management, lending and other business activities, seriously affecting the bank’s financial situation and operations.
Vu was one of the biggest property investors in Da Nang. He was the chairman of three major property companies and a shareholder in a number of other projects in the city, usually considered the third most important locality in Vietnam after Hanoi and Ho Chi Minh City.
He was arrested in January after being deported from Singapore, and is already serving an eight-year sentence for “deliberately disclosing state secrets.”
Since his arrest, Vietnam has arrested or opened probe against several senior officials accused of involvement in businesses or schemes controlled by him, including two former chairmen of Da Nang, a former deputy chairman of Ho Chi Minh City and two former deputy police ministers.
The anti-corruption campaign spearheaded by Party chief and President Nguyen Phu Trong started with the state-run oil industry, but has since expanded to security, banking and land sectors.
Hai Duyen report on Vnexpress