The Hanoi People’s Court will open the second trial of Dinh La Thang, who is charged with of pouring VND800 billion ($35.3 million) of state-run Vietnam Oil and Gas Group (PetroVietnam) into OceanBank despite all the alerting signs on March 19.

Defendant Dinh La Thang at the first trial two months ago

According to the proposal of the court, while serving as the chairman of PetroVietnam, Dinh La Thang signed co-operation arrangement No.6934 dated September 18, 2008 to contribute capital to Ocean Commercial One Member Limited Liability Bank (OceanBank), chaired by Ha Van Tham.

Thang made this decision knowing full well that OceanBank was in a weak position and without meeting the Board of Management. He signed the resolution for the capital contribution without the approval of the prime minister, which was not in line with the regulations of the Ministry of Finance (MoF) and the State Bank of Vietnam (SBV).

The VND800 billion ($35.3 million) was divided into installments to contribute to OceanBank. Dinh La Thang and other defendants committed several violations during the contributions. On October 14, 2008, MoF sent a document to ask PetroVietnam for a detailed report on OceanBank’s financial status before the contribution, but the group did not respond.

The first capital contribution of VND400 billion ($17.6 million) took place at the end of 2008 when OceanBank issued stakes to raise charter capital to VND2 trillion ($88.1 million) from VND1 trillion ($44 million). PetroVietnam contributed VND400 billion ($17.6 million) of this, equivalent to 20 per cent of OceanBank’s charter capital, and all the staff of the group contributed another VND200 billion ($8.8 million), equaling 10 per cent.

After the contribution to become the strategic shareholder of OceanBank, Dinh La Thang signed a document directing and requesting PetroVietnam’s subsidiaries and contractors to create accounts and use the services of OceanBank.

The second capital contribution to OceanBank took place at the end of 2010. OceanBank asked Thang to raise the charter capital and he approved. On August 6, 2010, Dinh La Thang signed a document to purchase OceanBank’s additional capital and submitted it to the prime minister for approval.

On October 7, 2010, the Government Office responded to PetroVietnam, reminding them PetroVietnam to consider and balance capital, “If the bank’s financial status is difficult, PetroVietnam should not hold 20 per cent of OceanBank’s charter capital.”

However, Thang and other leaders of PetroVietnam still agreed to raise capital in OceanBank, making a second contribution of VND300 billion ($13.2 million).

In middle of 2011, OceanBank’s chairman Ha Van Tham suggested to increase charter capital and requested PetroVietnam to contribute. The third capital contribution of PetroVietnam to this bank was VND100 billion ($4.4 million).

As a result, PetroVietnam’s total capital contribution to OceanBank was VND800 billion ($35.3 million). Article 55(2) of the 2010 Law on Credit Institutions states: “An institutional shareholder may not own over 15 per cent of the charter capital of a credit institution.”

In 2015, OceanBank went into the red and was acquired at VND0. In the aftermath, a lot of leaders and bank staff were prosecuted, and PetroVietnam lost its contributions of VND800 billion ($35.3 million). The statement of the court confirmed that the loss seriously damaged state assets and PetroVietnam.

In 2015, OceanBank went into the red and was acquired at VND0. In the aftermath, a lot of leaders and bank staff were prosecuted, and PetroVietnam lost its contributions of VND800 billion ($35.3 million). The statement of the court confirmed that the loss seriously damaged state assets and PetroVietnam.

In December 2017, Dinh La Thang was arrested for involvement in deliberate violations of state regulations on economic management and causing serious economic damages (Article 165 of the Penal Code) during his term as PetroVietnam’s chairman (2009-2011), before becoming Minister of Transport.

Recently, on January 22, after 14 days of trial and deliberation of the case related to PetroVietnam and PetroVietnam Construction Corporation (PVC), Dinh La Thang was sentenced to 13 years of imprisonment for “intentionally violating state regulations on economic management and causing serious consequences.”

The court stated that PetroVietnam was put in charge of the Thai Binh 2 thermal power plant project that carried a total investment capital sum of VND31.5 trillion ($1.4 billion).

Without any bidding procedures, on June 18, 2010, Dinh La Thang signed the resolution to assign PVC the EPC package in the form of a bidding appointment. Despite being the official contractor to implement Contract No.33 since October 11, 2011, PetroVietnam paid advances of over $6.6 million and VND1.3 trillion ($58 million). These amounts were spent for the wrong purposes and Dinh La Thang played the mastermind role in this case.

VIR