Van Thinh Phat chairwoman on death row accused of laundering $17.5 bln

Property tycoon Truong My Lan allegedly laundered VND445 trillion ($17.5 billion) and illegally transferred $4.5 billion overseas from 2021-2022, according to the economic investigation agency (C03) under the Ministry of Public Security.

C03 has recommended Lan, chairwoman of property developer Van Thinh Phat, be charged with fraudulent appropriation of assets, money laundering, and illegal cross-border currency trafficking.

This came after C03 concluded the second phase of an investigation into the case at Van Thinh Phat Group, Saigon Commercial Bank (SCB), and related units and organizations.

The first phase resulted in Lan being tried in Ho Chi Minh City and sentenced to death for causing losses of VND677 trillion ($26.6 billion) to SCB. She has appealed the sentence.

In the second phase, besides Lan, 33 others were proposed to be prosecuted on the same charges.

According to the investigative agency, Lan and her accomplices, via four Van Thinh Phat subsidiaries, issued 25 unsecured bond packages to appropriate more than VND30 trillion ($1.18 billion).

Regarding the crime of “money laundering,” between January 2018 and October 2022, Lan instructed her accomplices to make 916 false loan applications to withdraw VND415 trillion ($16.32 biillion) from SCB for personal purposes.

To legalize the withdrawals and prevent authorities from tracing them, Lan directed the transfer of the money to 483 individuals and 450 entities.

When she needed money, she directed her subordinates to withdraw cash directly at SCB transaction points or transfer money to the accounts of shell companies and designated individuals.

Of the amount, VND255 trillion ($8.85 billion) was used to pay loans at SCB, VND1.84 trillion for implementing projects, VND15.14 trillion for her accomplices, VND5.6 trillion for paying loans at other banks, and VND1.65 trillion for paying bond principal and interest.

Regarding the charge of "Illegal cross-border currency transfer," the investigators determined that from October 27, 2012 to October 7, 2022, 21 companies under Van Thinh Phat made 78 illegal money transfers with a total amount of more than $1.5 billion. In addition, they received over $3 billion illegally from abroad, via 152 transactions.

Under the direction of Lan, Van Thinh Phat's staff colluded with SCB employees to make international money transfers through "false" share purchases, capital contributions, and loan and consultancy contracts between companies in Vietnam and overseas.

According to the judgment in the first phase of the case, from 2011, Lan acquired three weak private banks to merge them into SCB. Abusing the government's SCB restructuring policy, Lan turned the bank into a financial tool to mobilize capital for herself and the Van Thinh Phat ecosystem.

During her 10 years of running SCB, Lan directed her accomplices to disburse over 2,500 loans to the Van Thinh Phat ecosystem. By October 2022, Lan and the ecosystem still had nearly 1,300 outstanding loans worth VND677,000 billion ($27.09 billion) in principal and interest.

Van Thinh Phat Group has more than 1,000 businesses including subsidiaries and affiliates in Vietnam and abroad, which were divided into many layers. They have been referred to as the Van Thinh Phat ecosystem.