A court in Ho Chi Minh City has sentenced real estate tycoon Truong My Lan to death, marking a significant development in Vietnam's battle against financial corruption. The verdict was announced Thursday, according to state media Thanh Nien.
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Lan, 67 years old and chair of the real estate firm Van Thinh Phat, was found guilty of orchestrating a fraud amounting to $12.5 billion, which is nearly 3% of the country's GDP in 2022. Her scheme involved illegally controlling the Saigon Joint Stock Commercial Bank from 2012 to 2022. Lan funneled funds through thousands of ghost companies and bribed government officials to siphon off the money.
Her arrest in October 2022 was part of a wider crackdown on corruption in Vietnam, known as the Blazing Furnace campaign. This campaign has reached even the highest levels of Vietnamese politics, leading to the resignation of former President Vo Van Thuong in March.
The scale of Lan's trial has shocked the nation, as her company, VTP, was one of Vietnam's wealthiest real estate firms, involved in luxury residential buildings, offices, hotels, and shopping centers. Analysts are concerned that similar fraud may have occurred in other banks or businesses, impacting Vietnam's economic prospects. This has made foreign investors uneasy, especially as Vietnam aims to attract businesses shifting their supply chains away from China.
The real estate sector has been particularly affected, with over 1,300 property firms leaving the market in 2023. Developers are offering discounts and incentives like gold to attract buyers. Despite a decrease in rent for shophouses in Ho Chi Minh City, many remain empty, according to state media reports.
Communist Party General Secretary Nguyen Phu Trong has emphasized that the anti-corruption efforts will be ongoing, signaling a commitment to addressing financial misconduct in the long term.
