Real estate tycoon Truong My Lan has been sentenced to death by a court in Ho Chi Minh City for his involvement in Vietnam’s biggest financial fraud case, as reported by state media Thanh Nien.
The chair of the real estate company Van Thinh Phat, who is 67 years old, has been accused of committing fraud worth $12.5 billion. This amount accounts for nearly 3% of the country’s 2022 GDP. The allegations state that she illicitly controlled the Saigon Joint Stock Commercial Bank from 2012 to 2022 in order to divert these funds. She accomplished this through the use of thousands of ghost companies and by providing bribes to government officials.
In the ongoing anti-corruption drive in Vietnam, Lan’s arrest in October 2022 stood out as one of the most high-profile cases. The campaign, known as the Blazing Furnace, has been gaining momentum since 2022 and has reached even the highest levels of Vietnamese politics. Former President Vo Van Thuong, for instance, resigned in March after being implicated in this campaign.
However, the enormity of Lan’s trial has stunned the nation. VTP was one of Vietnam’s wealthiest real estate enterprises, with developments comprising luxury residential towers, offices, hotels, and shopping malls. Analysts said the scale of the scam raised concerns about whether other banks or businesses had made similar mistakes, dampening Vietnam’s economic outlook and making foreign investors nervous at a time when Vietnam has been attempting to position itself as the ideal location for businesses looking to shift their supply chains away from China.
The real estate sector in Vietnam has been severely affected by the ongoing challenges. In 2023, approximately 1,300 property firms decided to withdraw from the market. To entice buyers, developers have resorted to offering discounts and even gold as gifts. Despite the rent for shophouses dropping by a third in Ho Chi Minh City, many properties in the city center remain vacant, as reported by state media.
Communist Party General Secretary Nguyen Phu Trong, Vietnam’s top politician, stated in November that the fight against corruption would persist in the long run.
