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Death sentence handed down in major graft case

Released at: 13:48, 30/09/2017

Death sentence handed down in major graft case

Nguyen Xuan Son (white shirt) in the dock and Ha Van Tham (first from right). Photo: nld.com.vn)

Former Chairman of PetroVietnam sentenced to death while OceanBank Chairman given life in prison in banking scandal.

by Quang Huy

A court in Hanoi sentenced the former Chairman of the State oil and gas giant PetroVietnam to death and his counterpart at OceanBank to life imprisonment on September 29 for their roles in a multi-million-dollar graft case that has riveted the nation.

Nguyen Xuan Son served as PetroVietnam’s Chairman from 2014 before he joined the Ministry of Industry and Trade under a decision signed by former Prime Minister Nguyen Tan Dung. He was arrested in the same month and has been given the death penalty for appropriating VND246 billion ($13.6 million) from OceanBank.

PetroVietnam had bought a 20 per cent stake in the bank, which meant that Son had stolen VND49 billion ($2.15 million) in government money, prosecutors said. The 55-year-old was charged with embezzlement, abuse of power, and deliberately violating state regulations on economic management.

Ha Van Tham, former Chairman of OceanBank, was sentenced to life behind bars for embezzlement, deliberately violating State regulations on economic management, and breaking regulations on lending activities at credit institutions.

He was accused of offering deposit rates above those set by the central bank to various customers, including PetroVietnam, between 2010 and 2014, causing losses of nearly VND1.6 trillion ($70.4 million).

Although the defendants said that the excessive interest rates were just a business strategy aimed at saving the bank and actually resulted in a healthy profit, the indictment said the crime “seriously affected the monetary market.”

Tham, a US-educated banker who was Vietnam’s eighth richest man in 2013 based on stock holdings, had won several national awards for outstanding entrepreneurship before his arrest in October 2014.

He is also accused of approving a VND500 billion ($23.5 million) loan for Pham Cong Danh, former Chairman of the Vietnam Construction Bank, via a real estate firm, in 2012 without properly securing collateral. The Ho Chi Minh City-based company later defaulted on the loan.

Danh was sentenced to 14 years. He is already serving a 30-year jail term after being found guilty last year of illegally withdrawing more than VND9 trillion ($404 million) from the bank.

On September 25, in his closing statement, Tham asked the judges to be lenient with his employees. “You used to sit with me on a boat when I was captain. I fell and many of you had to fall with me,” Tham said, addressing his former employees, who account for a large number of the defendants. “I am sorry for implicating you in this.”

In his closing statement, Son called the proposed death penalty an “unjust verdict”. His lawyer, Mr. Le Minh Tam, was quoted as saying that he would appeal.

OceanBank was founded in 1993 with a 20 per cent stake from the Ocean Group, which also invests in hospitality, securities, media, and retail. It was taken over by the central bank in April 2015 after the scandal broke out.

The high-profile trial, with 51 bankers and businesspeople in the dock, lasted a month, and the heaviest sentences followed the recommendations made by the country’s top prosecutors two weeks earlier. It could go down as the biggest fraud trial in Vietnam’s history.

The Ministry of Public Security has launched a separate investigation into who else benefited from the illegal activities. According to the indictment, more than 50,000 individuals and nearly 400 organizations and businesses received preferential deposit interest payments from the bank, including many State-owned units besides PetroVietnam. But only 19 businesses have admitted to having received a combined VND3 billion ($132,000), while 124 denied taking any money and the rest remained silent.

At least three PetroVietnam units were put under investigation earlier this month for colluding with OceanBank executives to appropriate $5.2 million.

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