Ms. Truong My Lan before the court's verdict

On October 17, in nearly 3 hours of announcing the verdict against Ms. Truong My Lan, 68 years old, Chairwoman of Van Thinh Phat Group and 33 defendants, the People's Court of Ho Chi Minh City summarized the trial process over the past month; the views of the defendants and lawyers, and gave their views on the defendants' criminal acts.

According to the Trial Panel, the documents and evidence in the file and the defendants' testimonies have sufficient basis to determine that Ms. Lan and her accomplices committed a series of acts:Fraudulent appropriation30,081 billion VND of 35,824 bondholders through the issuance of fake bonds;Money laundering445,747 billion andIllegal transportation of currency across borders(4.5 billion USD - equivalent to 106,730 billion VND). "The prosecution of the defendants on the corresponding charges is well-founded, in accordance with the law, and not unjust," the verdict stated.

In behaviorFraudulent appropriation of property,The court determined that Ms. Truong My Lan, who holds the majority of shares in Van Thinh Phat Group and SCB, agreed with Nguyen Phuong Hong's proposal to issue bonds to deal with financial difficulties. To do so, the defendant met with key leaders of Van Thinh Phat and SCB to propose a policy of issuing bonds through 4 companies under Van Thinh Phat (An Dong, Sunny World, Quang Thuan and Setra); at the same time, she selected 5 other companies in the Van Thinh Phat ecosystem to sign primary purchase contracts for the bonds of the above 4 companies and Sai Gon Peninsula Investment Joint Stock Company (partner) to come up with a plan to create a fake cash flow at SCB, legitimizing the status of primary bondholders.

Of the four issuing companies mentioned above, An Dong, Sunny World and Quang Thuan were eligible to issue bonds, while Setra Company was actually operating at a loss. However, the defendants "technically handled" the auditors of A&C Auditing Company to modify the financial statements and audit results so that this company was eligible to issue bonds.

According to the provisions of Article 2 of Decree 90/2011 and Article 4 of Decree 163/2018 on corporate bond issuance, "enterprises are allowed to issue individual bonds to less than 100 investors, excluding professional securities investors...". To circumvent these regulations, Ms. Lan's group came up with a plan to establish and sign fake economic contracts (buying and selling bond shares, borrowing money) between 4 issuing companies and 5 primary bondholder companies, partner companies and individuals hired to sign fake contracts. This would legalize the purpose of bond issuance, which is to use bond capital to invest in profitable projects.

At the same time, individuals were hired to create and sign fake transaction documents (deposits, cash withdrawals, transfers) and record fake transactions on the SCB system on the same day, in order to create a source of VND 30,869 billion for primary bondholders to transfer money to 4 issuing companies to buy nearly 309 million bonds.

After legalizing their primary bondholder status, Ms. Lan and her accomplices completed the creation of 25 fake bond packages and sold them to 35,824 secondary investors.

The trial panel determined that the bond issuance process involved the participation of many individuals from Van Thinh Phat and SCB in coordination. Afterwards, SCB conducted a series of activities to entice bond buyers (mostly depositors at SCB). The defendants used fraudulent tricks from selecting issuing companies and primary purchasing companies to handling fake cash flows and enticing customers to buy bonds. Thus, the crime was completed from the time the victim's money was transferred to SCB.

After appropriating, the defendants continued to use many fraudulent tricks to withdraw cash, conceal the cash flow and use it for many purposes that were not in accordance with the issuance plan. The defendants built a process from selecting the issuing company, signing fake contracts, running fake cash flow, selling to primary companies, and distributing to hundreds of thousands of people.

"This process shows that the intention to appropriate existed before committing the act. This is a characteristic sign of the crime, so the court has no basis to accept the viewpoint of some defendants and lawyers who said that 'they were not aware of the act when committing the crime'," the panel of judges stated their opinion.

Also from the above argument, the court rejected the view of Vo Tan Hoang Van and the lawyers that "he only helped Ms. Lan appropriate more than 7,000 billion VND of investors' money". According to the court, the defendant Van was the one who implemented the distribution of bonds to customers, so he must bear criminal responsibility for all consequences.

For crimeMoney launderingFrom January 1, 2018 to October 7, 2022, Ms. Lan, in order to conceal the origin and legalize the amount of more than VND 415,000 billion embezzled from SCB (in phase one of the case), directed her subordinates to carry out many tricks to transfer money out of the SCB system; or transfer money to individuals and legal entities to withdraw cash from their accounts. This behavior was aimed at avoiding detection and tracing of the money flow by authorities.

Combined with the amount of money fraudulently appropriated from bondholders (more than 30,000 billion VND), Ms. Lan and her accomplices committed the act ofMoney launderingtotal 445,747 billion VND.

In addition, within 10 years (from October 27, 2012 to October 7, 2022), 21 companies under Van Thinh Phat Group conducted 78 illegal money transfer transactions abroad with a total amount of more than 1.5 billion USD. 21 companies under Van Thinh Phat Group received money transferred from abroad in violation of regulations, with 152 transactions (totaling more than 3 billion USD). Thus, Ms. Lan and her accomplices haveIllegal transportation of currency across bordersover 4.5 billion USD.

During the trial, Ms. Lan did not claim her innocence, repeatedly reiterating her stance of "respecting the content of the prosecution's indictment". However, she said that she was not the one who proposed the policy of issuing bonds and did not appropriate money from bondholders. However, she pledged to use all of her assets to compensate 35,824 bondholders.

During her self-defense and final statement, Ms. Lan cried many times, expressed remorse for what had happened, and said she had paid a high price. She did not think that her life would end like this, but she considered it "a fate that must be accepted". She also expressed regret for participating in the restructuring of SCB, "not expecting the SCB machine to cost so much money", as well as causing tens of thousands of victims to suffer, and nearly 100 others to fall into legal trouble.

The other defendants all admitted to their crimes, but said they were unaware of their wrongdoings at the time, or acted under the direction of Ms. Lan and her superiors. Most expressed remorse for their actions and apologized to the bondholders. They asked the court to consider the circumstances in order to make a humane and lenient judgment.

In his previous opinion on the indictment, the representative of the Procuracy assessed that Ms. Lan played the main role in the case, the remaining defendants played the role of accomplices, helping Ms. Lan commit the crimes. Each defendant is a link in the chain, the actions of one defendant are the premise for the other defendants to commit the crimes.

The Procuracy noted that during the investigation and trial phase 2, with the support of her lawyer, Ms. Lan cooperated with her lawyer and family to find solutions and had financial resources to remedy the situation. However, up to this point, these measures are only options and solutions, not yet practical, and more time is needed to get results.

The prosecution agency noted many mitigating circumstances, the defendant Lan's changed attitude, and her awareness of remedying the consequences, but due to the nature and severity of the case being particularly serious, it was still necessary to apply a strict penalty to her. Therefore, the Procuracy proposed that the Trial Panel sentence Ms. Lan to life in prison for the crime.Fraudulent appropriation of property; 12-13 years in prison for the crimeMoney laundering; 8-9 years in prison for the crimeIllegal currency transfer across bordersThe total penalty is life imprisonment.

Based on the nature, role, behavior, level of violation and awareness, the Procuracy proposed sentences of 2 to 27 years in prison for 33 other people.

In the first phase of the major case, Ms. Truong My Lan was determined to have directed her accomplices to disburse a total of more than 2,500 loans to a group of companies in the Van Thinh Phat ecosystem during the 10 years of acquiring SCB. By October 2022, Ms. Lan and Van Thinh Phat's group still had nearly 1,300 loans with an outstanding principal and interest of VND 677,000 billion. However, by the time of the first instance trial, some loans had been paid off, and defendant Lan had also paid an additional amount to remedy the consequences, so she had to pay compensation of more than VND 673,800 billion.

Ho Chi Minh City People's Court sentenced Ms. Lan to 20 years in prison for the crime.Bribery; 20 years in prison for the crimeViolation of regulations on lending in the operations of credit institutionsand death penalty for the crimeEmbezzlement of property. In total, Ms. Lan must serve the death penalty.

Currently, Ms. Lan and the defendants have appealed this verdict, the appellate court has not yet set a trial date.