A court in Vietnam has upheld the death sentence for real estate tycoon Truong My Lan but said it could be commuted to life if she reimburses some 11 billion US dollars (£8.7 billion), or three-quarters of the amount she defrauded in the country’s largest financial crime.
The scale of the 67-year-old’s fraud shocked the nation, with analysts raising questions about whether other banks or businesses had similarly erred.
It has also dampened Vietnam’s economic outlook and made foreign investors jittery at a time when Vietnam has been trying to position itself as a home for businesses pivoting their supply chains away from China.
Lan was convicted in April of embezzlement and bribery amounting to 12.5 billion dollars (£9.9 billion), equivalent to 3% of the country’s GDP.
As chairwoman of the Van Thinh Phat real estate firm, the court said she illegally controlled Saigon Joint Stock Commercial Bank between 2012 and 2022 and allowed 2,500 loans that cost the bank 27 billion dollars (£21.3 billion) in losses.
A higher court in Ho Chi Minh on Tuesday rejected her appeal over the conviction but said her death sentence could be commuted to life if she reimburses three-quarters of the losses, working out at around 11 billion dollars (£8.7 billion), state media reported.
Her lawyers argued that she had repaid the money but the court disagreed because there were legal issues with some of the seized properties and prosecuting agencies could not assess their value, online newspaper VN Express reported.
Lan’s lawyers also noted several mitigating circumstances – she had admitted guilt, showed remorse and had paid back part of the amount.
“I feel pained due to the waste of national resources,” she said last week, according to state media.
But the court said her violations had negatively affecting the banking sector, caused public disorder and eroded people’s trust, VN Express said.
Under Vietnamese law, death sentences are not immediately carried out and there is an extended legal process, said Nguyen Khac Giang, a visiting fellow in the Vietnam Studies Programme at Singapore’s Iseas-Yusof Ishak Institute.
He added that Lan is likely to seek another review of the case or a presidential pardon to reduce her sentence.
“Moreover, if she repays at least three-quarters of the misappropriated funds, the court may consider commuting her sentence to life imprisonment,” he said.
Her arrest was among the most high-profile in an anti-corruption drive in Vietnam that intensified after 2022. The so-called Blazing Furnace campaign touched the highest echelons of Vietnamese politics.
Lan and her family had set up the Van Thing Phat company in 1992, after Vietnam shed its state-run economy in favour of a more market-oriented approach open to foreigners.
The business grew into one of Vietnam’s richest real estate firms, with luxury residential buildings, offices, hotels and shopping centres.
This made Lan a key player in the country’s financial industry, and she orchestrated the 2011 merger of the beleaguered SCB bank with two other lenders in co-ordination with Vietnam’s central bank.
The court said she used this to tap SCB for cash and, according to government documents, owned more than 90% of the bank while approving thousands of loans to “ghost companies”.
These loans, according to state media, found their way to her and she bribed officials to cover her tracks.
The scale of the crime meant the case was split into two trials, and Lan was sentenced to another life sentence in October.
At that trial, she was accused of raising 1.2 billion dollars (£946.7 million) from nearly 36,000 investors by issuing bonds illegally through four companies, state media reported.
She was also found guilty of siphoning off 18 billion dollars (£14.2 billion) obtained through fraud and for using companies controlled by her to illegally transfer more than 4.5 billion (£3.6 billion) in and out of Vietnam between 2012 and 2022.
Vietnam has handed down more than 2,000 death sentences in the past decade and executed more than 400 prisoners. It is a possible sentence for 14 different crimes but is typically applied for cases of murder and drug trafficking.
