Former general director of the State-run PetroVietnam Exploration Production Corporation (PVEP) Do Van Khanh, 58, was accused of receiving interest payments worth more than VND4 billion under the counter from Hanoi-based Ocean Commercial Bank (OceanBank).

Do Van Khanh, former general director of PetroVietnam Exploration Production Corporation, gestures while in an interview with Lao Dong newspaper in July 2014

The Supreme People’s Procuracy of Vietnam decided to prosecute  PVEP’s former leader Khanh; Nguyen Tuan Hung, 48, former head of the financial department at PVEP; and Vu Thi Ngoc Lan, 46, former deputy general director of PVEP for abusing their power to misappropriate assets, based on the 2015 Penal Code.

PVEP is a leading exploration and production arm of the State-run Vietnam Oil and Gas Group (PVN).

The case is part of the second phase of a high-profile case against Ha Van Tham, 47, former chairman and founder of OceanBank, who is currently serving a life setence for his intentional violation of rules, infringement of lending regulations, abuse of power and misappropriation of assets.

Following the instructions of PVN in 2019 to prioritize the use of OceanBank’s financial services since the State-run oil giant held a 20% stake in the lender, PVEP had placed a host of fixed-term and call deposits at the bank’s Thang Long branch, located in Hanoi, between 2009 and 2014.

During the period in question, Khanh assigned Lan, who was serving as his deputy general director in charge of finance, accounting and auditing, to approve the statements of the financial department, as well as sign and extend deposit contracts with OceanBank.

While serving as the head of the financial department between 2012 and 2014, Hung directly drafted and submitted the deposit contracts to Lan for her approval.

Meanwhile, then OceanBank chairman Tham ordered that the extra interest, which was not stated in the contracts, be paid to all the clients who had deposited money in the bank.

Nguyen Thi Minh Phuong, then deputy general director of OceanBank, personally asked Nguyen Tra My, then deputy director of the bank’s Thanh Long branch, and some other staff to make extra-contractual interest payments worth over VND51.8 billion as kickbacks through such deposit contracts to Hung of PVEP.

Hung claimed to have received and spent only VND39.2 billion. However, based on available evidence, the top prosecution stated that there are sufficient grounds to prove that he had received over VND51.8 billion in total.

His former boss Khanh was also found to have pocketed more than VND4 billion from Hung, while Lan got VND200 million from Phuong.

The PVEP trio will face criminal liability for these illicit sums of money, according to the prosecution.

During the investigation, Khanh and Lan sincerely admitted to their guilt, and worked closely with investigators. They even returned the misappropriated money.

Meanwhile, Hung did not claim all of his illicit money and did not pay back his share. He also claimed to have transferred a certain amount of the sum to many other individuals, but investigators did not obtain sufficient evidence in this regard.

Therefore, the police decided to separate his offence and documents relevant to his testimony in another case in January, which drew support from the top prosecution.

Former executives of the bank, Phuong and My, who were found to have made the extra interest payments, were already subject to the rule of law in the first phase of the graft case, so they will not face criminal liability in the ongoing case.