Truong My Lan: Vietnamese Tycoon in the race for 9 billion repayment

Truong My Lan: Vietnamese Tycoon in the race for 9 billion repayment

The real estate maggot Truong My Lan was one of the richest business women in Vietnam. With a breathtakingly valuable portfolio of luxury real estate, hotels and commercial properties across the country and abroad, it is said to have supposedly transformed a large bank in her personal ATMs.

judgment and indictment

On Tuesday, the 68-year-old lost her calling against the death penalty, which was imposed on her because of the mastermine role in one of the greatest fraud cases in global history in which billions disappeared from the Vietnamese financial system.

In April she was sentenced to death by a court in Ho Chi Minh City after being charged with embezzlement of more than $ 12 billion-an amount that corresponds to about 3% of the total Vietnamese economy. The extent of the fraud shaken the confidence in an economy that hopes to reject foreign investors from competitors such as the neighboring China, which may have to be dealt with with US tariffs during Donald Trump's second term.

a possible conversion of the death penalty

Nevertheless, there is a little glimmer of hope for LAN - provided she can afford it. Their death penalty could be converted into a lifelong prison sentence if it repaid three quarters of their profits made by fraud, the judges report in their judgment, as the state media company Vnexpress International reports.

modest beginnings and ascent

Truong My Lan was born in a modest Sino-Vietnamese family in 1956 and began to sell cosmetics together with her mother on the oldest market of Ho-Chi-Minh-Stadt. Step by step, she built up small companies, but her wealth exploded after she hit Hong Kong investor Eric Chu. In 1992 she founded the real estate company van Thinh Phat, in the year of her wedding with Chu.

Already in 2011 LAN was a powerful, albeit little-known managing director in Ho Chi-Minh-Stadt. This year she was involved in the merger of the Struggling Saigon Joint Commercial Bank with two other lenders, a deal that was coordinated by the Vietnamese central bank.

The fraud and its consequences

Over a decade later, the manipulation of the banking system came to light when the real estate bubble burst in Vietnam and, during the Covid 19 pandemic, several companies associated with LAN struggled financially, according to Nguyen Khac Giang, visiting scientist at Vietnam Studies programs of the ISEAS-YUSOF Ishak Institute.

The arrest of LAN in October 2022 led to a week -long rush to the Saigon Commercial Bank (SCB), which at that time was the fifth largest bank in the country due to suspected moments to their alleged financial crimes.

lan's arrest lit a time bomb that echoed through the business and political elites. Officially, LAN had 5% of the SCB shares, which is the upper limit permitted under Vietnamese law. However, the public prosecutor accused her of owning 91.5% of the bank indirectly, according to state media reported on the process. In addition, she is accused of having bribed bank supervisory authorities and civil servants to blur her traces.

The scope of the fraud

Investigators accuse her and dozens of accomplices of gaining loans and cash through a network of thousands of mailbox companies over more than a decade-a total of $ 44 billion was branched off.

For comparison: The long-lasting 1MDB state fund scandal in Malaysia, which began in 2009 and is one of the largest financial crimes in the world, concerned the embezzlement of around $ 4.5 billion. Even the fraud of the crypto entrepreneur Sam Bankman-Fried in the amount of $ 8 billion fades alongside Lan's case.

reactions and outlook

"If corruption occurs to this extent in a country, it signals that things are bad because it means that legislation and supervision are poor and the financial system is actually quite susceptible," said Giang.

lan has asked for mercy several times. During a trial in October, she said in court that she never wanted to cheat but was willing to take responsibility, as documented in a report by Vnexpress International.

"I consider this as my fate", LAN was quoted.

The effects on Vietnam

The defeat of the real estate magbatin shocked because the extent of the fraud has shaken a country that has long projected an image of authoritarian stability. The Vietnam's Communist Party (CPV) has been running the country since the end of the Vietnam War in 1975 and praised its durability and faithful party affiliation.

Vietnam has changed from a state -run economy towards a market -friendly one in a number of reforms, known as "Doi Moi", in 1986 and welcomed private companies as well as foreign investors.

The financial crimes of LAN have uncovered how unstable the country's financial system is actually, Zachary Abuza, professor of Southeast Asia Politics at the National War College in Washington, firm.

"In Vietnam the country is controlled by the state. There is no way to do it, without official support," said Abuza.

Your process, which began in March, was publicly pursued in the state media, and parts of it were streamed live outside of the court in Ho Chi-Minh-Stadt to show the public that the government carried out its offensive against corruption.