Is the reward fund at CNS a state asset?

On the morning of May 31, after the debate of the defense attorneys for 10 defendants at the first instance trial of the case of "violating regulations on management and use of state assets causing loss and waste" occurring at Saigon Industrial Corporation Limited (abbreviated as CNS) and TIE Joint Stock Company (a subsidiary of CNS, abbreviated as TIE), the representative of the Ho Chi Minh City People's Procuracy responded to some contents.

At 4:00 p.m. today, the People's Court will announce the verdict for defendant Chu Tien Dung and 9 accomplices.

The Procuracy once again affirmed that CNS is a 100% state-owned enterprise under the People's Committee of Ho Chi Minh City, TIE is an enterprise under the Department of Industry and Trade with 70% of CNS's capital; therefore, it must comply with regulations on management and use of state assets at enterprises.

However, the individuals involved at CNS and TIE proposed, decided and implemented the process of spending money from the reward fund at CNS and divesting capital at TIE without following the provisions of law, causing a loss of state assets, which is money from CNS Company, of more than 22 billion VND (reward fund of more than 17.3 billion VND; illegal divestment at TIE of more than 4.6 billion VND).

Regarding the defense opinion of some lawyers, the money in the reward fund of a 100% state-owned enterprise is not state property, based on the provisions of Clause 3, Clause 4, Article 32 of Decree 91/2015/ND-CP; Article 63, Article 112 of Circular 200/2014/TT-BTC. Because this is the amount of money distributed from after-tax profits, recorded in the short-term payable account on the balance sheet attached to the annual financial report of the enterprise. And because the reward fund is not equity, not state property invested in the enterprise, the lawyers requested the panel of judges to consider whether the defendants involved caused damage to the state of more than 17.3 billion VND or not.

Procuracy: Reward fund at CNS is state property

In response, the People's Procuracy affirmed that the reward fund is a state asset, because CNS is an enterprise in which the Ho Chi Minh City People's Committee holds 100% of its charter capital. The enterprise's activities are operated in accordance with the provisions of the Law on Management and Use of State Capital Invested in Production and Business at Enterprises in 2014, the Law on Enterprises in 2020, and Decree 91/2015 of the Prime Minister.

According to the People's Procuracy, Clause 1, Article 32 of Decree 91/2015 clearly states that the use of state-owned enterprise funds must be for the right purposes and for the right subjects. Thus, Decree 91 has determined that funds at state-owned enterprises are the enterprise's funds. CNS is a state-owned enterprise, so the enterprise's funds are state assets.

5 prosecutors hold the right to prosecute in court

The Procuracy analyzed that the law also stipulates that rewards must be implemented in accordance with state regulations, including the Accounting Law, Decree 91 of the Government and other regulations. When organizations and individuals receive bonuses according to regulations, that money belongs to the individuals and organizations; before that, all the money in the reward fund still belongs to the CNS, that is, the state.

In addition, according to the People's Procuracy, the state is the owner of assets in state-owned enterprises. Because the state provides initial investment capital, the state also appoints, dismisses or disciplines, as well as decides the most important issues in state-owned enterprises...

Therefore, the People's Procuracy once again affirmed that the CNS bonus fund is state property, and the defendants involved were not wronged in this act.

Regarding the violation that caused the loss of more than 17.3 billion VND in the reward fund, according to the records, CNS leaders agreed to use the money from CNS's reward fund to serve foreign affairs, diplomacy, and gratitude to units and individuals outside CNS on holidays and Tet. However, the defendants did not comply with the provisions of the Accounting Law, when all reward payment records did not have a specific list of individuals receiving the reward and did not clearly state the achievements in supporting and contributing to CNS to be rewarded according to the prescribed criteria and conditions, causing a loss of more than 17.3 billion VND of CNS. Meanwhile, in reality, the money was spent on the proposer/proposing department.

After the defendants had their final words, the panel of judges announced that they would announce the verdict at 4:00 p.m. today.

Yesterday, May 30, in the argument, the representative of the Ho Chi Minh City People's Procuracy, who held the right to prosecute at the court, requested the panel of judges to sentence defendant Chu Tien Dung (former General Director of CNS) to 7-8 years in prison, Do Van Nga (former Chief Accountant of CNS) to 6-7 years in prison, Nguyen Hoanh Hoa (former Chairman of the Board of Members of CNS) and Nguyen Hoang Anh (former Chief of Office of CNS) to 3-4 years in prison. The remaining 6 defendants in the case were requested by the Procuracy to be sentenced to 15-36 months of suspended imprisonment.

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