Dong Nai police say they are broadening investigations in the real estate fraud case under which Nguyen Khanh Hung, chairman of LDG Investment JSC, was arrested Thursday.
The arrest was made for "deceiving customers," an offence under Article 198 of the Penal Code, police said, adding that the provincial procuracy department has approved Hung's arrest on the deception charge.
The case involves the Tan Thinh Residential Area project in Doi 61 commune, Trang Bom district, which has been caught committing several violations including the construction of almost 500 properties without permission, non-payment of compensation to displaced residents, and sale of the illegally built properties.
Approved by the authorities in 2018, the project, touted as a pioneering “smart” urban area, was to have 488 villas and 290 townhouses, schools, supermarkets and medical facilities built on 18 hectares that hosted rubber plantations.
The case has already seen the arrest of several officials including Phan Duy Nghia, former head of Trang Bom district's urban management department; Nguyen Hai Trieu, deputy head of the department; Nguyen Van Nhat Huy, an official at the department; Luong Quang Huy, former deputy head of the department and chairman of the Giang Dien commune people's Committee; and Nguyen Lan Hanh, an official at the district's department of natural resources and environment.
The officials have been arrested for "abusing position and power while performing official duties" under Article 356 of the Penal Code.
The police said they are looking to broaden the scope of investigation into the case to compile more evidence and identify specific offenses committed by various parties so that consequential legal proceedings can be initiated.
At the end of August 2023, Hung was fined more than VND520 million ($21,400) by the State Securities Commission for committing an administrative violation, failing to report transactions. He was also suspended from securities trading activities for four months.
Shares of LDG Investment JSC, listed on the Ho Chi Minh Stock Exchange as LDG, closed down 6.8% at the floor price of VND3,450 ($0.14) each on Friday.