Photo Courtesy of nhadatvideo via Flickr.
Morgan Nguyen ’26
Contributing Writer
Content warning: this article mentions rape and sexual abuse.
In a landmark decision that has sent shockwaves through Vietnam’s legal and financial sectors, Trương Mỹ Lan, a prominent billionaire and former chairperson of a major conglomerate, has been sentenced to death for her involvement in the largest fraud case in the country’s history, the Associated Press reported.
Trương Mỹ Lan, once revered as a leading figure in Vietnam’s business community as one of the founders of Vạn Thịnh Phát, one of the country’s wealthiest real estate firms, was accused of conducting fraudulent activities that led to substantial financial losses for investors and stakeholders, PBS reported.
“Lan was involved in the 2011 merger of the beleaguered Saigon Joint Commercial Bank, or SCB, with two other lenders in a plan coordinated by Vietnam’s central bank,” the Associated Press reported. She is accused of using thousands of ghost companies both domestically and abroad to grant loans to herself and her supporters. According to VnExpress, “The judges said that Lan owned 91.5% of SCB at some point through different people and had the highest authority at the bank.”
The case against Trương Mỹ Lan gained widespread attention due to the magnitude of the financial misconduct and the implications for the country’s economic stability. According to VnExpress, “Between 2012 and 2017, she directed the approval of 368 loans,” which caused a loss of 64.6 trillion VND to SCB omitting collaterals, while between 2018 and 2022, she approved 916 loans and appropriated 304 trillion VND, amounting to a loss of 130 trillion VND.
The 2,500 loans totaled more than 1 quadrillion VND ($44 billion), “accounting for 93% of SCB’s total lending during this period,” and caused a loss of 677 trillion VND to the bank, VnExpress reported. According to the Associated Press, that is “nearly 3% of the country’s 2022 GDP.”
“Lan was tried alongside 84 defendants, including her husband (who was sentenced to nine years in prison), close relatives, 45 SCB staff (including three executives given life prison sentences), 15 former officers from the Vietnam State Bank, three officials from the Government Inspectorate and one from the State Audit Office,” TIME reported. “Proceedings involved 10 state prosecutors, some 200 lawyers, and 2,700 witnesses. Evidence filled 104 boxes and weighed six tons.”
Vietnam’s use of capital punishment remains a controversial and significant aspect of its legal system. According to the World Coalition Against the Death Penalty, the country retains the death penalty for 22 offenses, including “murder, armed robbery, drug trafficking, rape, sexual abuse of children, and a range of economic crimes, such as graft and corruption, fraud and embezzlement (for 500 million dong – $33,200 – or more of state property).”
The Human Rights Measurement Initiative rated the country a 5.1 out of 10 on the right to freedom from the death penalty. Critics argue that the punishment lacks transparency in its application. CNN reported that between 2013 and 2016, the country carried out 429 executions, making Vietnam one of the world’s largest executioners after China and Iran. “The number of people remaining on ‘death row’ is not known,” The Diplomat reported.
This high-profile case is expected to have broader ramifications for Vietnam’s business landscape, potentially prompting increased scrutiny and regulatory measures aimed at preventing similar instances of financial misconduct in the future. According to the Financial Times, “Lan’s arrest in 2022 triggered a slowdown in the property market and corporate bond activity.”
The real estate market was hit especially hard, with 1,300 firms withdrawing from the Vietnamese market in 2023, NPR reported. According to TIME magazine, the verdict has pushed businesses to complain about “bureaucratic paralysis,” as “officials [are] now too scared” of crackdowns to approve new projects.
Lan’s verdict underscores the state Communist Party’s determination to tackle corruption and uphold integrity. Vietnam’s former president. Võ Văn Thưởng, left office last month after a one-year term after “violations and shortcomings” that were not disclosed, Financial Times reported. The Financial Times also reported that prior to that, former president Nguyễn Xuân Phúc had stepped down in January of 2023 “amid an overhaul of the government’s top ranks that also saw the departure of two deputy prime ministers.”According to BBC News, the role was “largely ceremonial” but “considered to be a natural stepping stone to becoming” the state Communist Party’s general secretary, the most powerful position within the country’s leadership structure.
However, the country is keen to make this case a victory for clean governance. According to TIME magazine, under Nguyễn Phú Trọng, the Party’s current general secretary, the country’s corruption ranking has improved, leading to an increase in foreign direct investment.
The Financial Times reported that in 2023, Vietnam received a record-breaking $36.6 billion in FDI, equivalent to 4.3% of the country’s GDP that year, according to CEIC Data. This comes at a time when Vietnam is increasing its bid as the new manufacturing hub for businesses shifting its production chain from China, NPR reported.