Mr. Trinh Van Quyet's "virtual" capital increase scam

According to the conclusion issued by the Ministry of Public Security, in August 2012, former chairman of FLC Group Trinh Van Quyet directed three subordinates to jointly buy back GreenBelt Entertainment JSC for 1.5 billion VND.

Mr. Quyet asked someone to contribute capital to this company and then changed the name twice to Vinh Ha Infrastructure Investment and Construction Joint Stock Company and then to FLC Faros Construction Joint Stock Company.

"Virtual" capital circulates, businesses are "pumped" from 1.5 billion to... 4,300 billion VND

In the early years, Mr. Quyet's company was almost inactive, and the charter capital remained unchanged - remaining at 1.5 billion VND.

However, since April 2014, Mr. Quyet directed his sister Trinh Thi Minh Hue (an accountant in the accounting department of FLC Group) and a number of subordinates to repeatedly create fake capital contribution documents to "inflate" the company's charter capital to increase "skyrocketingly".

FLC Faros shareholders signed forged documents such as payment orders, cash deposit slips, cash withdrawal slips... for Mr. Quyet's sister to use as procedures to deposit money, withdraw money, and then re-submit... in a cycle many times.

FLC Faros' capital is "virtual" because the money was immediately transferred to the bank account and then quickly withdrawn through many forms such as advances, prepayments, investments, and investment trusts for related individuals and organizations.

In total, FLC Faros has increased its charter capital five times from VND1.5 billion to VND4,300 billion, equivalent to 430 million shares. To conceal the withdrawal of capital, Mr. Quyet used the method of establishing fake investment trust, loan, and business cooperation contracts. When the contract expired and the investment trust, business cooperation, and loan funds had to be recovered, Mr. Quyet concealed it by signing contracts to buy shares of companies in the FLC group.

After inflating the charter capital, knowing that Faros did not meet the conditions to be listed on the Ho Chi Minh City Stock Exchange, Mr. Quyet still directed his subordinates to prepare documents to send to state management agencies for approval.

On August 24, 2016, the stock code ROS was listed on the stock exchange with 430 million shares, par value of VND 10,000, total value of shares at par value of VND 4,300 billion.

FLC stock code was "inflated" to increase by more than 1,700%

From September 2016 to March 2022, Mr. Quyet assigned Ms. Hue to use accounts under the name of Trinh Van Quyet and 40 securities accounts under the names of others to buy and sell ROS shares. In total, Ms. Hue sold more than 391 million ROS shares initially formed from fake capital contributions (shares with no guaranteed value) for more than VND 4,800 billion.

At Faros, the charter capital is 4,300 billion VND but the actual amount contributed by shareholders is 1,197 billion VND, used for general contractor activities to construct FLC projects before listing. Therefore, the investigation agency determined that Mr. Trinh Van Quyet had appropriated more than 3,600 billion VND from investors buying ROS shares.

In addition, Mr. Quyet was also accused of directing his sister to use 500 securities accounts to continuously buy and sell, cross-matching to create fake supply and demand, "steering" five FLC "family" stock codes to increase from 70 - 1,700%.

According to the conclusion, with the stock code AMD, within just two months, Trinh Van Quyet's group manipulated the price to increase by more than 70% from 13,750 VND/share to 23,450 VND/share. With this code alone, Mr. Quyet illegally earned more than 39 billion VND.

With the stock code HAI of HAI Agricultural Chemicals Joint Stock Company, Trinh Van Quyet's group manipulated the price to increase by more than 459%.

Specifically, Mr. Quyet's sister used 69 accounts, participated in 156 trading sessions of HAI shares, pushing the price from 3,780 VND/share to 22,500 VND/share. The investigation agency accused Trinh Van Quyet of illegally profiting more than 238 billion VND from manipulating the stock market and "inflating" the price of HAI shares.

Trinh Van Quyet's group also manipulated the price of FLC stock code of FLC Group. In more than a year (from September 2020 to January 2022), FLC code increased from 3,050 VND to more than 21,000 VND/share, equivalent to an increase of more than 593%. The amount of money Trinh Van Quyet illegally profited from performing stock manipulation for FLC stock code was more than 397 billion VND - the investigation agency accused.

Notably, stock code GAB (belonging to FLC Mining Investment and Asset Management Joint Stock Company) was manipulated by Trinh Van Quyet's group, "inflating" the price by 1,776%. This stock code increased "skyrocketingly" from 10,900 VND, reaching the "ceiling" for many sessions, and the highest increase session reached 193,600 VND.

The investigation agency accused Trinh Van Quyet of directing Trinh Thi Minh Hue and his accomplices to manipulate the stock market for the stock code GAB and illegally profited more than 44 billion VND. The total amount of money Mr. Quyet illegally profited from manipulating the "inflated" price of five FLC stock codes was 723 billion VND.