The second trial for a prominent Vietnamese real estate tycoon, who was previously sentenced to death for financial fraud, commenced on Thursday in Hanoi, Vietnam. The 67-year-old chair of the real estate company Van Thinh Phat was convicted for orchestrating Vietnam's largest financial fraud case, amounting to $12.5 billion, which is nearly 3% of the country’s 2022 GDP. Additionally, she was found guilty of illegally controlling a major bank, resulting in losses of $27 billion.
Her arrest and subsequent conviction were part of an anti-corruption drive that has been gaining momentum since 2022. The campaign, known as the blazing furnace, has also implicated high-ranking officials in Vietnamese politics, leading to the resignation of a former president.
In the ongoing trial, the tycoon faces new charges of appropriating property fraudulently and engaging in money laundering. Investigations revealed that she raised $1.2 billion from approximately 36,000 investors by unlawfully issuing bonds through four companies. Furthermore, it was discovered that 21 companies under her control illegally transferred over $4.5 billion in and out of Vietnam between 2012-2022. She is also accused of siphoning off $18 billion obtained through fraudulent means.
The case involves a total of 33 defendants and is anticipated to last for a month. The tycoon and her family established the Van Thinh Phat company in 1992, following Vietnam's transition to a more market-oriented economy. Initially starting by assisting her mother in selling cosmetics, she eventually built Van Thinh Phat into one of Vietnam’s wealthiest real estate firms, known for luxury residential buildings, offices, hotels, and shopping centers.
The revelations from her first trial sent shockwaves through Vietnam, raising concerns about the integrity of other financial institutions and businesses. This has had a dampening effect on Vietnam’s economic prospects and has made foreign investors wary at a time when the country is striving to attract businesses looking to diversify their supply chains away from China.
