Prosecutors of HCMC on August 16 proposed sentencing Pham Cong Danh, former chairman of Vietnam Construction Bank (VNCB), to 30 years in jail for his credit and financial violations that caused losses of over VND9 trillion (US$417 million).

Danh faces 20 years behind bars for deliberately violating State regulations on economic management causing severe consequences and another 20-year jail term for violating the lending regulations on credit institutions, resulting in a combined prison term of 30 years.

Prosecutors also want a prison term from 24 to 26 years to be handed down on Phan Thanh Mai, former director of VNCB, and 22 to 24 years for Mai Huu Khuong, former director of VNCB’s Saigon branch. Hoang Dinh Quyet, former deputy director of Saigon branch and former director of Lam Giang branch, faces 20 to 22 years for the same charges as Danh.

Jail terms from three to 16 years were also proposed for other accomplices in the notorious case in the banking sector. Other defendants, who were carwash staff and janitors at Thien Thanh Group but Danh made them directors of the group’s affiliates in the fraud, can get suspended sentences.

For civil liabilities, prosecutors requested Danh, Thien Thanh Group and its 12 affiliates to compensate over VND9 trillion for VNCB. For 124 deposit certificates of a group of depositors led by Tran Ngoc Bich, prosecutors proposed VNCB keep holding them to ensure debt recovery.

Besides, the prosecution also suggested legal proceedings against Nguyen Viet Ha, general director of Loc Viet Fund, for helping Danh issue VND900 billion bonds to three companies, with all the money going into his pocket. Pham Thi Trang could also stand trial for supporting Danh to borrow from the Bich-led group of depositors while violations of lending regulations TrustBank could be brought to justice.

Furthermore, prosecutors suggested law enforcement officers clarify BIDV’s lending VND4.7 trillion to Danh and responsibilities of some supervision officials at the State Bank of Vietnam.

The case has been referred to as the biggest ever financial criminal case in Vietnam.

According to court documents, prior to his arrest, Danh was chairman of Thien Thanh Group, a construction and real estate corporation in Vietnam. In late 2012, Danh acquired TrustBank to restructure the loss-making lender, and later renamed it VNCB.

However, Danh abused his position by instructing his staff in the group and the bank to commit a slew of violations.

Danh is accused of cooking the books in a software system upgrade project to withdraw from the bank’s budget. He asked his accomplices to sign falsified house rental contracts at 268 To Hien Thanh Street and 816 Su Van Hanh Street in HCMC, with two of his companies.

Danh also withdrew VND5.49 trillion in savings from a group of depositors led by Bich without her knowledge.

Moreover, Danh told staff at Thien Thanh Group to issue 2,500 corporate bonds and then sell VND900 billion worth of the debt paper to three other companies. VNCB issued the loans to buy the bonds, with the funds transferred to Danh afterwards.

Danh and his accomplices were also charged with numerous credit and financial violations.

SGT