As previously reported by VietNamNet, the Ministry of Public Security’s Investigation Police Agency has completed its investigation conclusion and proposed prosecution of Nguyen Thi Nhu Loan, chairwoman and CEO of Quoc Cuong Gia Lai, along with 21 other defendants, on five criminal charges.

Among them, Loan is charged with violating regulations on the management and use of state assets, causing losses and waste. Investigators allege that her actions caused losses to the state of more than VND542 billion and generated illicit gains of more than VND297 billion.

Loan’s alleged criminal conduct originated from a business deal involving the acquisition of the 39–39B Ben Van Don land plot (HCMC) and its resale to a partner, Thinh Vuong Real Estate JSC, a member of the Novaland Group.

The land plot was originally allocated by the HCMC People’s Committee to the Vietnam Rubber Group for management and use for production and business purposes.

In December 2009, Le Quang Thung, former acting chairman and CEO of the Vietnam Rubber Group, reached an agreement with Le Y Linh, former director of Viet Tin Co. Ltd., and Dang Phuoc Dua, then chairman of the members’ council of Phu Viet Tin Company, to transfer the 39–39B Ben Van Don land plot at a price of $1,200 per sqm, through the establishment and transfer of capital contributions in Phu Viet Tin Company.

In November 2013, Nguyen Thi Nhu Loan learned that Le Y Linh and Dang Phuoc Dua wanted to transfer the project and sought to acquire it.

In her testimony to investigators, Loan stated that she agreed with Linh and Dua on a purchase price of VND460.9 billion for the land plot, including land use fees.

Linh and Dua were responsible for working with the relevant parties to sell 100 percent of the capital contribution in Phu Viet Tin Company to Loan. Loan, in turn, was responsible for placing a deposit of VND50 billion so that Linh and Dua could complete procedures and pay VND186.1 billion in land use fees on their behalf.

Under the agreement, Loan transferred the two amounts and formalized them as a contract under which Quoc Cuong Gia Lai lent VND186.1 billion to Phu Viet Tin Company to pay land use fees. 

When Linh and Dua failed to fulfill the contract (after paying land use fees, Dua was required to transfer 35 percent of the capital contribution to Loan), Loan went to the Vietnam Rubber Group to seek clarification.

Loan was informed by Pham Van Thanh, former head of the Planning and Investment Department of the Vietnam Rubber Group, and Tran Ngoc Thuan, then CEO, that Linh and Dua still owed money for the capital contribution purchase.

When questioned, Dua confirmed this and requested an advance of VND65 billion from Loan to pay the Vietnam Rubber Group. Loan agreed and transferred the amount.

Subsequently, companies owned by Linh and Dua acquired 99 percent of the capital contribution in Phu Viet Tin Company from Dong Nai Rubber and Ba Ria Rubber, then transferred the entire stake to Quoc Cuong Gia Lai. As for the remaining 1 percent, Loan later signed a contract to acquire it as well.

Reselling, earning VND382 billion in profit

According to Loan’s testimony, after Quoc Cuong Gia Lai resold the project to Thinh Vuong Real Estate JSC for more than VND846 billion, and after deducting total costs of more than VND464 billion to acquire 100 percent of the project (including capital contribution purchase costs, loan interest, and project design expenses), Quoc Cuong Gia Lai earned nearly VND382 billion in profit, which was included in the company’s overall business cash flow.

After deducting capital usage costs of more than VND10.2 billion (calculated at an interest rate of 10 percent per year), paying corporate income tax of VND84 billion, and distributing nearly VND88 billion in dividends to other shareholders, Quoc Cuong Gia Lai retained benefits of around VND201 billion and applied to return this amount to mitigate the consequences.

Investigators confirmed that Quoc Cuong Gia Lai has paid VND100 billion, and that four real estate assets have been seized to remedy the damage. According to Loan’s testimony, these properties are valued at VND281.2 billion.

T. Nhung