Chain of methods of 'manipulating' SCB by Truong My Lan and accomplices

In the case that occurred at Van Thinh Phat Group Joint Stock Company, An Dong Investment Group Joint Stock Company, Saigon Commercial Joint Stock Bank (SCB) and related units, the behavior of Truong My Lan (born in 1956, Chairwoman of the Board of Directors of Van Thinh Phat Group) and her accomplices was assessed to have many sophisticated criminal tricks and methods.

Using many criminal methods, Lan and her accomplices stirred up and "made waves" at SCB, aiming to take over and control all of the bank's operations.

Truong My Lan (born in 1956, Chairwoman of the Board of Directors of Van Thinh Phat Group) and her accomplices are assessed to have many sophisticated criminal tricks and methods.

Acquire, control and operate all activities of SCB

According to the indictment of the Supreme People's Procuracy, Truong My Lan is the Chairwoman of Van Thinh Phat Group, which includes a group of subsidiaries and affiliated companies.

To have a large source of capital to serve the operations of the above Company system as well as continuously invest and purchase real estate projects, Truong My Lan sought to acquire, control and operate all activities of SCB Bank, including lending activities.

Therefore, before the merger, Truong My Lan already owned the majority of shares in the 3 banks. After the merger, Truong My Lan continued to have 73 shareholders own over 85% of SCB shares, and continued to buy and use individuals to own SCB shares to increase her ownership ratio in this bank to over 91% on January 1, 2018.

To control, direct and operate all activities of SCB, Truong My Lan selected and placed trusted individuals with qualifications in the fields of finance and banking, who followed Lan's instructions, in key leadership positions at SCB Bank (Board of Directors, Board of General Directors, Directors of large branches, Head of the Board of Supervisors), paying high salaries from 200 to 500 million VND/month; giving and rewarding money and SCB shares, so that through these individuals, they could operate all activities of SCB...

Using SCB as a financial tool

By acquiring, holding shares, controlling and operating banking activities through key entities, Truong My Lan used SCB as a financial tool, mobilizing deposits and capital from other sources, then directing withdrawals by creating fake loans for personal purposes.

To withdraw money, Truong My Lan directed and directed trusted individuals who held key roles at SCB and Van Thinh Phat Group to establish many departments, units, and companies, hire and use thousands of individuals, collude closely with each other, and collude with Valuation Companies to withdraw money.

Specifically, Truong My Lan established units under SCB only to lend and disburse according to Truong My Lan's request. Truong My Lan directed Dinh Van Thanh, Chairman of the Board of Directors; Vo Tan Hoang Van, General Director of SCB, Nguyen Phuong Hong, Deputy General Director of SCB to establish 3 lending units to serve loans including: Wholesale Customer Business Center, Direct Business Channel under the Enterprise Division, Direct Business Channel under the Banking and Personal Finance Services Division.

All three units have lending functions like branches but are under the management of SCB Headquarters. They do not have their own treasury department and seal, but use the seal of another unit when operating and only prepare loan documents for Truong My Lan's loans.

Of which, from June 3, 2020 to June 24, 2022, these 3 lending units have prepared documents and disbursed 396 loans/total outstanding debt of VND 212,725 billion, of which the principal outstanding debt is VND 185,183 billion, interest/fee debt is VND 27,542 billion (accounting for 38.27% of the principal outstanding debt of Truong My Lan's loans).

Creating a system of "gutting" SCB

The Supreme People's Procuracy determined that Truong My Lan directed the establishment and use of "ghost" companies, hired/asked individuals to stand in their names for loan applications, shares, collateral, signed legal withdrawal and deposit documents to create fake loan applications and withdraw money from SCB.

The investigation results determined that there were 875 customers including 440 individuals and 435 legal entities with 1,284 loans, which were established, hired or had others named by Truong My Lan as a group of subjects at Van Thinh Phat Group.

In addition to creating "ghost" companies under the name of loan applications, Truong My Lan also colluded with and directed subjects who were owners, legal representatives or assigned to manage actual companies with business activities.

In which, Truong Hue Van is Truong My Lan's niece, assigned to manage and operate a number of companies in Van Thinh Phat Group; Nguyen Phi Long (General Director), Dang Quang Nguyen, (Deputy General Director) of Lavifood Company; Chu Nap Kee Eric (Chu Lap Co) is Truong My Lan's husband, Chairman of Times Square Investment Joint Stock Company... so that these companies can borrow capital in their names or create more "ghost" companies, create fake loan profiles and plans, withdraw money from SCB for joint use.

Disbursement first, legalization later

Every time she needed to withdraw money, Truong My Lan directed SCB officials and accomplices to create fake loan documents and plans to make them legal; had individuals hired/assigned to sign the loan documents, property documents, and representatives of "ghost" companies sign the fake loan documents and mortgage documents, mostly signing on blank sheets of paper with the required signature positions marked.

The legal representatives and individuals whose names are on the loan are not entitled to enjoy or use the money, and do not know that they have borrowed and owed SCB a particularly large amount of money; the people whose names are on the assets all confirm that they are not their assets.

Most of the loans of Truong My Lan - Van Thinh Phat Group were disbursed first and legalized later. The loan records show the disbursement time at the same time as the signing of the credit contract and mortgage contract, but in reality, the withdrawal of money at SCB Bank was made before the credit contract and mortgage procedures were completed and legalized.

Of the 1,284 loans under Truong My Lan's responsibility that still have outstanding debt, there are 684 loans with outstanding debt of VND 382,876 billion that have not had mortgage procedures when disbursing, the remaining collateral assets are mainly shares and property rights. In particular, there are 201 loans with outstanding debt of VND 11,686 billion that have loan documents without approval from competent authorities at SCB.

Inflating the value of collateral

The Procuracy determined that Truong My Lan colluded with the Valuation Company to issue a Certificate of inflated value of collateral assets and included it in the loan application; provided collateral assets that were not legally sufficient; did not register the secured transaction; withdrew assets of high value and exchanged them for assets of lower value.

Specifically, in order to withdraw money from SCB through the trick of creating fake loan documents, Truong My Lan directed SCB officials to collude with subjects at Valuation Companies to issue Valuation Certificates to legalize Truong My Lan's loan documents.

The investigation results determined: SCB hired 19 valuation companies/46 subjects including Directors, Deputy Directors, Appraisers, and issuance staff to participate in issuing 378 certificates related to outstanding loans of Truong My Lan group. Up to now, it has been determined that 5 valuation companies issued 23 valid valuation certificates for loans of Truong My Lan group.

To legalize the documents and withdraw money, Truong My Lan and her accomplices used many assets that did not meet legal requirements and inflated their prices to use as collateral for the loans. For the 1,284 outstanding loans under Truong My Lan's responsibility, there are 1,166 asset codes with a recorded book value of VND 1,265,504 billion recorded by SCB, but Hoang Quan Valuation Company was only able to value 726/1,166 asset codes. The remaining number could not be valued because the assets were shares, property rights, real estate without sufficient documents, property legality, etc.

When it was necessary to withdraw legal and valuable assets to sell or use for other purposes, Truong My Lan directed her accomplices to exchange and withdraw valuable collateral assets from SCB, replacing them with other assets, most of which had lower value than the withdrawn assets. To easily exchange collateral assets, Truong My Lan and her accomplices at SCB did not register the secured transaction as prescribed or transformed it into “Property Rights” to avoid registering the secured transaction.

Cut off cash flow, sell bad debt

To legalize the withdrawal of money that SCB had disbursed under a fake plan, cut off, conceal the cash flow, avoid detection and handling by authorities, Truong My Lan directed her subordinates to develop a plan to implement the "fund disbursement" by creating a contract promising to transfer fake shares to use the money without being inspected and handled by authorities, and at the same time avoid having to pay taxes according to the law; at the same time, hire individuals to be the loan beneficiaries, share holders... to come to the Bank to sign withdrawal and deposit documents.

When the loans were overdue and had to be accounted for as bad debt group 5, while the credit growth rate was limited according to the regulations of the State Bank, Truong My Lan did not pay the debt but also directed her accomplices to sell bad debt to the Vietnam Asset Management Company (VAMC) and sell deferred debt to the "ghost" companies established by the Van Thinh Phat group to conceal part of the bad debt, not to account for interest, reduce credit balance to continue to appropriate money from SCB. The investigation results determined: During the period from January 1, 2012 to October 7, 2022, Truong My Lan and her accomplices directed subjects at SCB to sell bad debt to VAMC, sell deferred credit loans, and offset 269 loans of 216 customers.

Cover up the wrongdoings

In order to conceal her criminal acts when being inspected and audited, Truong My Lan directed key officials of SCB to bribe officials and leaders of the Banking Inspection and Supervision Agency, leaders of the State Bank of Vietnam, Ho Chi Minh City Branch, and the Head of the Enhanced Supervision Team at SCB so that the above-mentioned authorized individuals would cover up and conceal information about violations and report dishonest and incomplete inspection and audit results.

In addition, Truong My Lan directed key leaders of SCB to allocate Truong My Lan's loans from some main branches (Sai Gon, Cong Quynh, Pham Ngoc Thach, Ben Thanh) to some other branches (Dong Sai Gon, Cu Chi, Tan Dinh ...) to reduce the attention of the authorities.

In particular, in the period of 2017 - 2018, the Interdisciplinary Inspection Team focused on inspecting SCB Pham Ngoc Thach Branch because it discovered signs of violations. To conceal and deal with the situation, Truong My Lan directed the loan settlement at this branch by creating new loans at other SCB branches, using the disbursed money to settle the loans at Pham Ngoc Thach Branch.

The Supreme People's Procuracy concluded that in this case, Truong My Lan had acquired and practically held almost the absolute number of shares of SCB Bank (from 85% to 91.5% of shares), thereby becoming a shareholder with the "power" to direct and operate, essentially manipulating all activities to serve her own purposes.

(Source: Tin Tuc Newspaper)

Source