In a landmark ruling that has sent shockwaves through Vietnam, Hanoi-based real estate magnate Truong My Lan was condemned to death by a Ho Chi Minh City court on Thursday. This decision marks the climax of Vietnam’s most monumental case of financial deception to date, as reported by state-owned Thanh Nien newspaper.
At 67, the head of the Van Thinh Phat real estate conglomerate faced charges for orchestrating a fraud scheme valued at $12.5 billion, a figure that represents nearly 3% of Vietnam’s GDP for the year 2022. Lan was found guilty of orchestrating an elaborate scheme to illicitly take control of the Saigon Joint Stock Commercial Bank from 2012 through 2022, funneling these enormous sums via myriad shell companies and engaging in bribery of public officials.
The apprehension of Lan in October 2022 stood out as one of the most striking actions in Vietnam’s escalated crackdown on corruption, a campaign that has been vigorously pursued since 2022 under the banner of the “Blazing Furnace” initiative. This campaign has implicated individuals at the highest levels of the Vietnamese government, leading to the resignation of former President Vo Van Thuong in March after connections to the initiative were revealed.
The extent and implications of Lan’s trial have astounded both the nation and international observers. Van Thinh Phat, Lan’s firm, was a powerhouse in the Vietnamese real estate market, boasting a portfolio that included high-end residential properties, office spaces, hotels, and retail centers. The revelation of the fraud has raised concerns about the integrity of other financial institutions and businesses, casting a shadow over Vietnam’s economic future and unsettling foreign investors at a crucial time when Vietnam has been striving to attract businesses diversifying away from China.
The real estate sector, in particular, has felt the brunt of the scandal. In 2023, approximately 1,300 property companies exited the market, with developers resorting to unprecedented measures like discounts and gold giveaways to entice purchasers. Despite a significant drop in rents for commercial properties in downtown Ho Chi Minh City, many remain unoccupied, highlighting the sector’s distress as reported by state media.
In a statement last November, Nguyen Phu Trong, the General Secretary of the Communist Party of Vietnam and the country’s preeminent political figure, underscored the commitment to perpetuating the anti-corruption endeavor indefinitely.
