A real estate mogul faces the death penalty in Ho Chi Minh City for bank fraud totaling almost 5% of Vietnam’s GDP.
A Vietnamese woman, Truong My Lan, faces the death penalty if convicted of bank fraud in Ho Chi Minh City, Reuters reports. Prosecutors in Lan’s trial, which began on March 19, have asked for the death penalty due to the size of the offense. According to Reuters, Lan and her cohorts pulled a total of $20 billion, or almost 5% of Vietnam’s GDP, out of Saigon Joint Stock Commercial Bank (SCB) between 2018 and 2022. Prosecutors state that Lan owned the bank through a myriad of shell companies.
Lan and her gang siphoned off than 304 trillion dong, equal to $12.46 billion, from SCB. In addition, prosecutors are preparing to charge them regarding a further 193 trillion dong, including more than 129 trillion dong in interest that has accumulated on outstanding loans.
Over four years, Lan had SCB arrange illegal loans to shell companies she ultimately controlled, according to prosecutors. She also stands accused of bribery and has paid as much as $5.2 million to central bank personnel. Besides the central bank, independent auditors such as EY and KPMG turned a blind eye to misdoings at the bank. Vietnam’s central bank had to step in and bail out account holders at SCB in 2022.
FATF Greylist
Vietnam’s Communist Party leader Nguyen Phu Trong has made the fight against corruption a center piece of his administration. However, the country remains on the FATF grey list, which indicates the lack of proper KYC and AML procedures within the country, and cases like this indicate that it’s highly unlikely that Vietnam is going to come off of the FA TF grey list in the near future.
Getting removed from the grey list possible. For instance, the United Arab Emirates was removed from the list in 2024.
The procedures that are strengthened or put in place would also help in preventing fraud. Removal usually comes after a period of interaction with FATF. The task force sends teams to identify and gain government agreement regarding banking and law enforcement regulations that need improvement. After defining the scope of the work to be done, the teams will visit at defined waypoints, and again for a final review.
In the case of Vietnam, preventing fraud by implementing better processes and review procedures, with stiff non-lethal penalties for violations is not a current topic of discussion. However, when the government does decide to act, the way forward is cut and dried.
Argomenti
