Court upholds death penalty for tycoon convicted of Vietnam’s largest banking fraud

A court in Vietnam on Tuesday upheld the death sentence for real estate tycoon Truong My Lan, rejecting her appeal against a conviction for embezzlement and bribery, according to state media.

Lan, sentenced to death earlier this year for embezzling billions from Saigon Commercial Bank (SCB), was awaiting the verdict of her appeal.

Lan, 68, was appealing a death sentence for orchestrating a $44bn fraud – the largest in banking history. Convicted in April under Vietnam’s anti-corruption campaign, she was accused of secretly controlling Saigon Commercial Bank and embezzling $12bn. She was also convicted of bribing government officials and breaching bank lending regulations.

“The consequences Lan caused are unprecedented in the history of litigation and the amount of money embezzled is unprecedentedly large and unrecoverable,” the prosecution was quoted as saying at the appeal hearing by state-run online newspaper VietnamNet.

“The defendant’s actions have affected many aspects of society, the financial market, the economy,” it said.

Her only hope was to repay $9bn – 75 per cent of the misappropriated funds – to have her sentence commuted to life imprisonment.

“We are now trying to help her to avoid the death penalty,” Lan’s lawyer Giang Hong Thanh said earlier. “There is a group of overseas investors who have agreed to lend Lan $400 million and they are working on the documents required to send the money in,” he said.

According to Vietnamese law, Lan’s sentence could be reduced if she managed to return three-quarters of the embezzled assets.

Lan, the former chair of Van Thinh Phat Group, is at the centre of Vietnam’s high-profile anti-corruption crackdown that has grabbed global attention. Earlier last month, she appeared visibly shaken in court when prosecutors proposed upholding the death penalty, describing herself as psychologically disturbed by the decision, according to VnExpress.

In October, she was sentenced to life imprisonment in a separate trial for illegally transferring $4.5bn across borders, laundering $17.5bn from Saigon Commercial Bank, and misappropriating $1.2bn through fraudulent bond issuances.

Lan’s case is part of the “blazing furnace” anti-corruption campaign, a sweeping initiative led initially by the late Communist Party General Secretary Nguyen Phu Trong.

The current general secretary, To Lam, has vowed to continue the campaign with equal resolve, targeting corruption across all sectors and resulting in the detention of numerous high-ranking officials and executives.

Her lawyers were seeking leniency from the judges, arguing that a death sentence would hinder her ability to negotiate favourable deals for selling her assets and investments, making it more challenging to raise the $9bn required. They contend she would have a better chance of achieving this under a life sentence.

About 36,000 people have been identified as victims of the SCB fraud, a scandal that shook the communist nation and sparked rare protests from those affected.

Lan and her family founded the Van Thinh Phat company in 1992, following Vietnam’s transition from a state-controlled economy to a market-oriented system that welcomed foreign investment.

According to the state media outlet Tien Phong, Lan began her career by assisting her mother, a Chinese entrepreneur, in selling cosmetics at Ho Chi Minh City’s oldest market.

Lan still has the right to request a review under Vietnam’s cassation or retrial procedures.