Sentenced to life in prison for appropriating 1,200 billion VND from two tycoons

On May 27, Phung Thi Nghe, Chairwoman of the Board of Directors of Viet Hung Phat Group Corporation, was sentenced to life in prison by the People's Court of Ho Chi Minh City for the crime ofFraudulent appropriation of property;forced to compensate the remaining 321 billion VND to two female tycoons in Phu My Hung.

According to the court, during the investigation and at trial, the defendant did not admit to his actions, but there was sufficient evidence to show that Nghe used deceitful means, provided false information to trick victims into contributing capital, and then appropriated it. "The defendant appropriated an exceptionally large amount of money but was evasive in denying his crime, so a severe penalty is needed to have sufficient deterrence," the panel of judges stated their opinion in imposing the highest sentence for the crime.

The verdict determined that Nghe had worked for a time at a bank, then quit to do freelance real estate and car business. In 2018, the defendant established Money Exchange Company, carried out procedures to open foreign currency exchange counters at shopping malls but let his younger brother be the legal representative. Initially, Nghe borrowed money from his family and from the bank to buy real estate and cars and used part of it to run a foreign currency exchange counter, building a cover as a successful businessman. Later, to expand the scale of the foreign currency exchange counters, the defendant began to mobilize money from many people with a commitment to pay interest.

From late 2019 to 2021, the Covid-19 outbreak made business ineffective. To have money to pay for premises, employee salaries and other expenses, Nghe borrowed from many people at high interest rates to maintain the operation of foreign currency exchange counters but was later forced to close.

To have money to pay off the debt, Nghe provided false information such as: contributing capital to the petroleum business, buying and selling USD, contributing capital to establish a bank, making bank loans, establishing a credit fund... and promised to pay high profits from this business to mobilize money from many people for the purpose of appropriation.

Nghe repeatedly called on two female tycoons in Phu My Hung area to contribute capital to "do business in petroleum and establish a private bank". Of which, he received nearly 602 billion VND from Ms. Loan and more than 606 billion VND from Ms. Thanh.

Nghe provided information that he was "applying for permission to establish a private bank". The money he received from the tycoons, Nghe used as a deposit and committed to let the victims be the shareholders when establishing the bank. Next, Nghe used money borrowed from others to pay Ms. Loan and Thanh a part, or used Ms. Thanh's own money to pay Ms. Loan and vice versa, to make the victims think that his business was "profitable".

The verification results at the State Bank showed absolutely no evidence of Nghe applying for a bank establishment or conducting business activities. By 2021, Nghe was no longer able to "pay the profits" and was asked for money. The defendant made a commitment to pay the debt but did not do so, so he was denounced by the creditors.