Vietnam property tycoon Truong My Lan sentenced to death in $12 billion fraud case

By Team Asianet Newsable | First Published Apr 11, 2024, 2:41 PM IST

In a significant development, a Vietnam court on Thursday sentenced real estate tycoon Truong My Lan to death for her involvement in a $12 billion fraud case, marking one of the sternest penalties amid the Communist Party's anti-corruption crackdown.

The 67-year-old chair of the real estate firm Van Thinh Phat faced allegations of fraud totaling $12.5 billion, equivalent to nearly 3% of the country’s 2022 GDP. She allegedly illicitly controlled the Saigon Joint Stock Commercial Bank from 2012 to 2022, funneling these funds through numerous ghost companies and by offering bribes to government officials.

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Lan's arrest in October 2022 was one of the most prominent in an ongoing anti-corruption initiative in Vietnam, which has escalated since 2022. This campaign, known as the Blazing Furnace, has reached the uppermost levels of Vietnamese politics, with former President Vo Van Thuong stepping down in March following his implication in the crackdown.

The sheer magnitude of Lan's trial has sent shockwaves across the nation. Van Thinh Phat (VTP) stood as one of Vietnam’s wealthiest real estate enterprises, boasting projects ranging from luxury residential complexes to commercial buildings, hotels, and shopping centers. Analysts have raised concerns about the extensive nature of the fraud, prompting inquiries into whether other financial institutions or businesses have similarly faltered. This has cast a shadow on Vietnam's economic prospects and stirred unease among foreign investors, particularly as Vietnam endeavors to position itself as an attractive destination for businesses seeking to diversify their supply chains away from China.

The real estate sector in Vietnam has borne the brunt of the fallout: Approximately 1,300 property companies exited the market in 2023, developers have resorted to offering discounts and incentives like gold to entice buyers, and despite a significant drop in shophouse rents by a third in Ho Chi Minh City, many units in the city center remain unoccupied, as reported by state media.

In November, Communist Party General Secretary Nguyen Phu Trong, Vietnam’s foremost political figure, affirmed that the anti-corruption crusade would be an enduring endeavor.

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